Free to grow? Assessing the barriers faced by actual and potential high growth firms

Neil Lee

Nesta Working Paper 11/01
Issued: November 2011
JEL Classification: L0, D21, L2, L10
Keywords: High growth firms, barriers to growth, Gazelles

Abstract

A small proportion of high growth firms create the majority of all new jobs. For policymakers, it is important to know (1) what obstacles are faced by high growth firms and (2) what obstacles are faced by firms with the potential to achieve high growth, but which are yet to achieve this. This paper investigates these issues using the UK Small Business Survey. It highlights six areas where high growth firms experience problems: obtaining finance, cash flow, recruiting staff, skill shortages, managerial skills and the availability and cost of premises. Potential high growth firms argue that cash flow, recruiting, the availability and cost of premises and managerial skills are important.

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