Report January 2021

In a nutshell


  1. Daily business creation increases by 18.5 % between the first and second lockdown.
  2. 16.9% more company registrations in the second lockdown, relative to the first one.
  3. 17,167 additional companies registered in December 2020 than in December 2019.
  4. 2,465 new daily company registrations since the first Pfizer/BioNTech vaccine.
  5. Manufacturing, retail and wholesale sectors outperform in December 2020 relative to their 2019 levels. Accommodation and Food services sector’s recovery, occurred after the initial lockdown, worsens as certain areas enter the new Tier-4 scheme.

We analyse Companies House “basic company data” up to the December 31st, 2020 to understand the effect of COVID-19 policies on business creation, and hence, economic activity. We find that daily business creation increases by 18.5% after the first, but before the second, lockdown. 17,167 additional companies registered in December 2020 relative to December 2019. There is more firm creation in every sector, notably in manufacturing, retail, and wholesale sectors. Firm creation continues to increase relative to recent months, but accommodation and food services’ strong performance weakens.

Aggregate Analysis


The charts below show the daily company incorporations in the UK for 2020.

The following table summarises the median and the mean of daily new registrations in different periods in 2020. We notice a moderate shock during lockdown-II. The daily median goes from 3057 incorporations during lockdown-II to 2675 incorporations per day after lockdown-II, but before the New Tier-4 Scheme. This is a fall in business creation of 1.9%. London, South East and East of England move to tier 4 on December 20th, under the new Tier scheme. From the 20th December to 31st December, firm creation is significantly higher than over the same 12 days in 2019 (regardless of the EU-UK Trade deal). Daily median business creation shrinks by 7.5% and 20.8% relative to the period during the first and second lockdown, respectively. Most of the business creation occurs on December 30th and 31st and concerns the manufacturing sector. This may be related to Brexit and more specifically to the EU-UK Trade and Cooperation Agreement (TCA).

Table: Median and Mean of new daily companies Incorporations in 2020

Lockdown ILockdown IINew Tier-4 Scheme
TotalBeforeDuringAfterDuringAfterDuringsince first vaccine

Download table as:


Since July, company registrations persistently exceed their 2019 levels. Over 2020, on average, 2848 daily new companies register.

Similar performance is observed between the end of the first and during the second lockdown (July - December). This may be, mostly, attributed to the less restrictions attached to lockdown-II given the different duration of these two periods. 16.9% more companies registrations noted during the second lockdown than the first one.

Regional Analysis

Postcode Area

The following map shows the average percentage change of new registrations occurred in December relative to December 2019. Greater changes are showed with bigger bubbles. To see the values, hoover your mouse over each bubble.


The following graph aggregates the business creation by country. We separate London from England. In December 2020, firm creation remains higher in all regions than it was in 2019. Northern Ireland’s recovery commences the end of June. It faces, though, several fluctuations until the end of lockdown-II.

Sectoral Analysis

SIC Sections

The following graph illustrates the company registrations in 2020 by industrial sector relative to 2019 values. For the analysis, we use the 2-digit SIC level and convert it to sectors, following the ONS classification.

In December 2020, all sectors observe higher firm creation than December 2019. Mining and quarrying, arts, entertainment and recreation sectors present the smallest change relative to their 2019 levels. Manufacturing, wholesale, and retail trade sectors present the greatest increase in firm creation. Accommodation and food services observe a significant drop after the introduction of Tier-4 scheme.