A new report from the Adam Smith Institute co-authored by our Executive Director, Duncan Simpson ; Director of Research, Maxwell Marlow ; and Head of Research, Daniel Pryor , finds that medium-sized businesses (MSBs) and their size-specific challenges are often neglected in public policy debates. MSBs are the “Forgotten Medium”.
- Focus is skewed towards both the smallest and largest companies in the UK, who benefit from support not offered to the “Forgotten Medium.”
- Scaling up MSBs would boost the UK’s growth prospects, in particular in areas of ‘levelling up’ concern.
- Over 83% of MSBs are outside London and the South East. Their products are overwhelmingly in non-services sectors such as retail, wholesale, and transport.
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The following policy changes can alleviate these problems:
- Implement a recommendation of the 2019 Augar Review for a lifelong loan entitlement. This would allow for 4 years of post-18 education over the course of a lifetime, allowing individuals (especially in MSBs) to re-skill.
- Enterprise Investment Allowance & Venture Capital Trust schemes should be modified to remove the cliff-edges facing MSBs who partake in them. To keep current and potential investors, the number of employees allowed should be raised to 999 from 249, as well as increasing the turnover and balance sheet totals.
- High Potential Individual visas should have a widened list of elite universities and a lower application fee to attract more high-skilled foreign labour.
- The Annual Investment Allowance should be made unlimited from its current level of £1 million. This would improve the growth prospects of MSBs, especially in capital intensive industries.
Authors
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- United Kingdom
