How does AIM Contribute to the UK Economy?
In 2019, AIM companies contributed £33.5 billion to UK GDP, directly supporting more than 430,000 jobs and contributing £3.2 billion in tax revenue. Over the last 5 years the direct economic contribution made by AIM companies has grown by 35% from £24.8 billion while employment has grown by 22%.
In addition to this, direct contribution from AIM companies support further economic activity through both their supply chains and the expenditure of employees in their local economies. Through their supply chain expenditure AIM companies support a further 294,000 jobs and £20.3 billion of GVA. This indirect impact includes a broad range of suppliers to AIM companies such as financial services (nominated advisers and stock-brokers), business services (registrars, financial public relations, legal, tax, accounting and audit) as well as wider goods and services.
Both those employed directly by AIM companies as well as those employees supported through the supply chain will spend their wages on goods and services supplied by UK businesses. These induced effects generate further employment and GVA. The induced impact is estimated to support a further 181,000 jobs and a £13.4 billion GVA contribution to GDP.
Taken together, the overall economic impact is equivalent to £67.2 billion in GVA and over 900,000 jobs.
Improving productivity
AIM companies are, on average, more productive than the national average with productivity of £77,700 GVA per employee compared to £56,387. This is only marginally below the London average of £79,586 – the most productive region in the UK. Over the last 5 years, the productivity of AIM companies has improved by 11% compared to 10% nationally and 9% in London.
Regional spread
Unlike most businesses on the main market, AIM businesses are spread regionally across the UK in terms of their location, workforce and production lines. This helps support the UK government’s strategic goal of improving productivity and prosperity across all regions of the UK and helping balance regional disparities. Regional benefits are clear across areas where productivity is lower such as in the Midlands, Yorkshire and the North East.
Encouraging exports
Exporting plays a vital role to the UK economy by raising additional revenue from overseas. Around 20% of the turnover of UK-incorporated AIM companies comes from overseas, twice as much as their private company comparators. This figure grew significantly from £7 billion in 2010 to £12.4 billion in 2019.
Supporting growth
AIM plays a key role in supporting growth in small and medium sized businesses by allowing them to raise external finance at different stages in their lifecycle. This enables them to raise equity capital supporting their innovation, driving productivity and creating employment. It is this access to appropriate financing options that allows a business to scale and reach their growth potential.
AIM has made a significant contribution to the UK economy and has a critical part to play in supporting the economic recovery and helping to support growth across the UK economy.
(Research Grant Thornton- June 2020)
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