Finance: Social enterprise could be three times bigger than first thought

A new Department of Trade and Industry survey has estimated that there are at least 15,000 social enterprises in the UK, a much higher number than previously thought.

According to research conducted by the DTI's Small Business Service, social enterprises generate £18bn in annual turnover, employ 475,000 people and account for 1.2 per cent of all businesses in the country.

The figures suggest that the social enterprise sector could actually be three times as large as in previous estimates, which had concluded there was an upper limit of 5,300 enterprises.

But the DTI said the new 15,000 figure could still underestimate the true size of the sector because it includes only social enterprises registered as companies limited by guarantee or industrial and provident societies.

Other legal forms, such as companies limited by shares, are not taken into account.

Jonathan Bland, chief executive of the Social Enterprise Coalition, said: "This important new data indicates that social enterprise is operating on a much larger scale than previously thought.

"It reinforces our view that social enterprise should be given much greater recognition and support by government at all levels."

Small Business Service minister Alun Michael said there was "an increasing role for the social enterprise sector that is strongly reinforced by this report. Its firm evidence will help us take the agenda forward."

The estimated turnover of social enterprises is 0.8 per cent of the total turnover of all employing businesses in the UK. One in five social enterprises turns over more than £1m per annum - the median turnover is £285,000.

The report concludes that the vast majority of this turnover is from trading revenues rather than grants - 905 of the 1,480 bodies surveyed generated at least half their income through trading. In order to be included in the survey, organisations had to produce 25 per cent of their funding through trading.

In addition to the social enterprise sector's 475,000 paid employees - which is close in size to the charity sector's half a million workers - there are also 300,000 volunteers who contribute an average of two hours a week each.

The average social enterprise employs 10 people. Forty-nine per cent employ fewer than 10, 38 per cent between 10 and 49, 11 per cent between 50 and 249 and 2 per cent more than 250.

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