New Enterprise Allowance Proves to be the Business for Job-Seeking Entrepreneurs
1 February 2016
The majority of entrepreneurial jobseekers who became their own
boss thanks to a UK government scheme are still in business, more
than a year after launching their start-up.
A survey of 1,500 participants of the New Enterprise Allowance
(NEA) published today (28 January) shows that 80% of ventures
started with NEA support are still trading - with more than 9 in 10
of these going for more than 12 months.
Around half of respondents report an expansion in their customer
base (55%) or an increase in turnover (47%) since starting their
business. The majority of survey participants also say they have
plans to grow their company in the coming years.
Employment Minister Priti Patel said:
"This government is determined to help jobseekers with real
entrepreneurial ambitions turn their ideas into successful business
ventures which create new jobs, boost productivity and contribute
to long-term economic growth.
The first year of trading is considered the most challenging, so
I'm delighted that through our New Enterprise Allowance and added
support services we are helping businesses stay on track and grow
12 months in."
The NEA initiative is delivered through Jobcentre Plus and offers
expert mentoring and financial support to jobseekers, lone parents
and people on sickness benefits who have a good idea to set up
their own business.
Set up in 2011, the latest statistics show almost 77,000 businesses
have started with NEA funding and support.
Furthermore, 1 in 5 (20%) of all businesses created using the NEA
have been set up by benefit claimants with a disability.
The NEA survey found that recipients started businesses in a wide
range of sectors including retail, car repair, construction and
The NEA survey also found:
- of those that received support from a mentor, the vast majority
(83%) rated it as helpful in supporting them develop a business
- two thirds (66%) of respondents did not access any additional
support outside of the NEA scheme at the time of developing their
business plan, suggesting that for most, the NEA scheme provided
sufficient and appropriate support
- the payment of the NEA weekly allowance was commonly
highlighted by respondents as being a critical factor in enabling
them to start their business
NEA case study
For Winsome Duncan, the New Enterprise Allowance was a stepping
stone to helping other people find the job of their dreams.
The 38-year-old from Southwark was recommended to take part in the
scheme by her work coach in 2013 after she told them she wanted to
help others gain skills and become more employable.
After developing a business plan to hold employability workshops
and receiving a £1,000 loan from Jobcentre Plus, Winsome also wrote
a book "100 Ways to Save Money: An Employment Guide", offering
advice to young people and ex-offenders looking to get on the
Her business MPLOYME is now in its third year and employs 3 people
part-time out of their base in the Pempeople pop-up shop on Peckham
"The NEA programme saved my life. It gave me a living and helped me
to put food on other people's tables as well as my own.
I am forever grateful to the programme, it's definitely
The business continues to expand, and Winsome wants to find her own
office space for the business:
You have to be dedicated and committed to make it work, and I would
advise anyone looking to start their own business to look at the