In May 2019, in collaboration with Hardman & Co we jointly published a report looking at the importance of small and mid-sized quoted companies (SMQCs) to the markets, and their contribution to tax revenues and employment in the UK. This was a poorly researched area and that report helped frame the debate on the importance of the small and mid-cap community within the UK economy.
Whilst the economic and business conditions in which we find ourselves today are very different from the pre-pandemic world of 2019 - and thus makes comparisons rather difficult - we felt the time had come for a review of this report.
Politicians and business leaders often refer to SMQCs as being pivotal to the future of the British economy, but the definition of “small and mid-sized” can cover a huge range of companies, and the difference between the UK’s largest companies and the rest is stark, as we often note throughout our work at the QCA.
In this new report for 2022, we examine the companies quoted on the UK’s public equity markets to highlight the difference in size between the largest 100 companies and the rest. We also present data that show the massive contribution that SMQCs make to our society, in terms of employment and tax revenues, and to the stock market.
We have also looked at the net change in the number of employees. Most alarming however is the net change of listed companies which has contributed to the figures above. The reason for this decline is partially attributed to the economic turbulence of recent years as well as unfavourable and overburdensome regulation for listed companies.
This decline is important to address, as there are many benefits of being a listed company - both for employees and wider society. This includes the impact of increased transparency required of public companies which fosters more trust with both external and internal stakeholders; the participation of employees in shares schemes, allowing them to share in the success of the business; the overall benefit of increased wealth distribution through the public markets and the enablement of increased competition and innovation which is ultimately propelled through public companies.
Read more in the full Punching above their weight? report here.