The UK added more businesses than it lost in 2024, according to the Office for National Statistics (ONS), and the gap between the two widened considerably. This article explains what the official birth, death and survival figures measure, how London compares, and how to read them without over-interpreting.
What did the ONS business demography figures show for 2024?
The ONS published its Business Demography release for 2024 on 20 November 2025. It is the standard official source on how many businesses start, stop and survive. The headline figures are:
| Measure | 2024 | 2023 |
|---|---|---|
| Active businesses | 2,860,000 | 2,870,000 |
| Business births | 317,000 | 316,000 |
| Business deaths (provisional) | 280,000 | about 310,000 |
| Birth rate | 11.1% | 11.0% |
| Death rate (provisional) | 9.8% | 10.8% |
The ONS reports that the birth rate edged up while the death rate fell by a full percentage point. The gap between the two rates was 1.3 percentage points in 2024, compared with 0.2 percentage points a year earlier. The arithmetic checks out: 11.1 minus 9.8 is 1.3, and 11.0 minus 10.8 is 0.2.
In plain terms, 2024 was a year in which fewer businesses closed than in 2023, while the number of new ones was broadly flat. That is reported fact. Whether it marks a turning point is a separate question, and the answer depends on data that was not yet available when the release was written.
How does the ONS define a business birth or death?
Definitions matter here, because they differ from everyday language. According to the ONS, an active business is one with turnover or employees at any point in the reference year. A birth is a new registration of a VAT or PAYE administrative unit, and a death is a business that has stopped trading, identified by the de-registration of its VAT or PAYE unit.
That has a few practical consequences:
- A business that begins trading below the VAT threshold and has no employees may not appear until it registers for either.
- A business that stops trading but delays de-registration may be counted late, which is one reason recent death figures are labelled provisional.
- The ONS also publishes an alternative “employer” view that counts only businesses with at least one employee, which gives a different and often more stable picture.
The statistics are drawn from the Inter-Departmental Business Register, the ONS list of businesses registered for VAT and/or PAYE. It is the sampling frame the ONS uses for its business surveys, so it is a carefully maintained register, but it is still an administrative one. It records registrations rather than ambitions.
Why did active businesses fall when births outnumbered deaths?
A reader might reasonably ask how the stock of active businesses dropped by 11,000, from 2.87 million to 2.86 million, in a year when 317,000 businesses were born and 280,000 died. On the face of it, 317,000 minus 280,000 suggests a gain of 37,000.
The figures do not reconcile as a simple sum, and the ONS does not present them that way. Counts are rounded to the nearest thousand, the 2023 and 2024 death counts are provisional, and the active stock is measured on a different basis from the flows of births and deaths. Our reading, which is analysis rather than reported fact, is that the headline lesson should be taken from the rates and direction of travel, not from subtracting one count from another.
It is a useful reminder that demography statistics describe a population in motion, not a bank balance.
What do birth and death rates look like by sector?
Rates vary sharply by industry, and the ONS highlights several in the 2024 release:
- Transport and storage (including postal): the highest birth rate, at 15.6%, and also the highest death rate, at 16.5%. This is a sector with a lot of churn, where entry is relatively easy and survival is hard. The ONS text and its table differ slightly on the death rate (16.6% in the text), so the figure is best treated as roughly 16.5%.
- Information and communication: the highest share of high-growth businesses, at 9.2%.
- Finance and insurance: a high-growth rate of 7.3%.
- Motor trades: the lowest high-growth rate, at 2.7%.
The ONS defines a high-growth business as one with 10 or more employees whose employment grew by more than 20% a year on average over three years, in this case from 2021 to 2024. There were 14,330 of them in 2024, up from 13,750 in 2023, which is 4.9% of the 292,125 businesses with 10 or more employees.
That is a small slice of the economy. Most businesses are not trying to scale rapidly, and many would not describe growth as their goal.
How does London compare with the rest of the UK?
London is where the figures are most distinctive. According to the ONS, the capital had 595,000 active businesses in 2024, with 76,000 births and 61,000 deaths. That gives a birth rate of 12.7%, the highest of any UK region, and a death rate of 10.3%.
London also had 3,540 high-growth businesses, a rate of 6.6%, again the highest of any region. Professional, scientific and technical activities were the largest contributor to London’s births, at 17.7%.
Two points are worth drawing out. First, London’s death rate of 10.3% is above the UK’s 9.8%, so the capital churns faster in both directions: more starts, and more stops. Second, the difference between London’s birth and death rates is 2.4 percentage points (12.7 minus 10.3), wider than the UK’s 1.3. Together, these support the familiar description of London as a place where businesses are formed readily, though the data say nothing about the reasons.
For more on the capital’s scale, see our explainer on how big London’s economy is according to ONS regional GDP.
What share of new businesses are still trading after five years?
Survival is the other half of the story. The ONS reports that of UK businesses born in 2019, 38.4% were still active five years later. A business counts as surviving if it was born in a given year, or survived to it, and is still active in the following year.
There is a wide regional spread:
| Region | Five-year survival (2019 births) |
|---|---|
| South West (highest) | 43.5% |
| UK overall | 38.4% |
| West Midlands (lowest) | 30.6% |
The gap between the best and worst regions is 12.9 percentage points (43.5 minus 30.6). The ONS also notes that transport and storage had the lowest five-year survival rate by industry, which fits with that sector’s high death rate.
Is a low survival rate a sign of failure?
Not necessarily. A business that is no longer active has stopped trading, but that can happen for many reasons: a founder retires, a contract ends, a side venture is wound down, a company is sold and folded into another, or the owner takes employment elsewhere. The administrative data cannot separate a sensible closure from a distressed one.
For formal distress specifically, the better source is insolvency data, which we covered in what the official company insolvency figures show. Insolvencies are only one route out of the register, and the ONS death figures are far larger than annual insolvency counts.
How should readers use these figures?
Three sensible habits follow from the data.
Compare rates, not just counts. A birth rate of 11.1% says more about the business population than 317,000 on its own, because it adjusts for the size of the stock.
Match the measure to the question. If the question is about ambitious, scaling firms, the high-growth numbers are closer to the point than the headline births. If it is about stress, insolvency and arrears data are better. If it is about the entrepreneurial base, births and deaths do the job.
Respect the lag. The 2024 release was published in November 2025, and deaths for the latest two years are provisional. These statistics are a well-built rear-view mirror, not a live dashboard.
The wider context is covered elsewhere on this site. The financing side of starting up is explored in how founders are operating in a tougher funding market, and one of the main tax incentives for young companies is explained in how R&D tax relief works for UK start-ups.
Conclusion: a population in motion, best read in rates
The ONS data for 2024 shows a UK business population of roughly 2.9 million that is constantly turning over: 11.1% born, 9.8% lost, and only 38.4% of the 2019 cohort still trading five years on. London stands out for its higher birth rate of 12.7% and its larger share of high-growth firms, while also showing a higher death rate than the national average.
The sound reading is a measured one. A wider gap between births and deaths in 2024 is encouraging, but the death figures are provisional, the register captures registrations rather than intentions, and one year does not make a trend. The next release date had not been announced at the time of the November 2025 publication, so readers should check the ONS for the latest edition.
This article is general information, not personalised financial advice. Rules, rates and statistics change, so check the latest official releases.
Sources: Office for National Statistics
