Entrepreneurs worth £1bn to British economy

Small business owners and entrepreneurs contribute more than £1 billion to the UK economy every year, it has been found.

The insurer Hiscox calculated the figure after discovering that owners of small to medium-sized businesses work over half a billion hours annually. This is equal to 700 hours a year more than employees of larger firms.

The research was published in the company's entrepreneurial domestic product (EDP), but Hiscox was also quick to point out the financial and personal traps involved in setting up a business.

Steve Langan, UK managing director of Hiscox, said: "Being your own boss can be a liberating experience, but with freedom comes risk."

"So many entrepreneurs put their homes, finances and even personal lives on the line when they first start out. Putting a figure such as the EDP against it, it's clear to see how hard small business owners are working to mitigate and overcome those risks."

An investigation in August discovered that only one third of small business managers have contingency plans in the event of a serious business disruption.