Knowledge economy contractors benefit from swift growth

The UK’s economy is thought to be in a relatively healthy state at the moment, with growth providing plenty of opportunities for businesses to generate healthy incomes. However, the so-called ‘knowledge economy’ is proving significantly more successful than other sectors in the UK at the moment, generating new business at four times the rate of the rest of the economy.

Knowledge companies in the UK are proving hugely successful, with a growth rate of 18.4 per cent over the last five years seeing the number of businesses leap from 225,000 to 266,400. By contrast, the number of businesses in the wider economy has grown by just 4.6 per cent over the same period.

The knowledge economy itself is based on intellectual capital, including sectors such as FinTech, film and TV production, pharmaceuticals and aerospace. This means that some of the most strategically vital businesses, and those which have the potential for the highest margins, are prospering, which important to the ongoing strength of the UK economy.

This has come about, at least partly, as a result of the role that the government has played in stimulating the knowledge economy with the tax credits offered to businesses for research and development. This has increased the investment in product development although the UK still lags some way behind our European counterparts.

The knowledge economy is an area which has traditionally been responsible for providing higher paid opportunities for contractors, with the knock-on benefits that this offers the UK economy as a whole.

With countries such as China getting more involved in lower margin manufacturing, the UK economy is increasingly coming to rely on the knowledge sectors in order to remain competitive.

One of the benefits to the knowledge economy from a contractor’s point of view is the speed with which projects are turned around, meaning that there are plenty of opportunities for contractors and consultants with the right skills.

If you think your skills lend themselves to a career in contracting, then our guides can help you achieve your goals, including information about being an IT contractor, a number of contractor case studies and a take home pay calculator which will help you to work out how much you could be earning.

For support and advice on maximising your income, a specialist accountant is the best way to ensure that you are paying the right amount of tax and making savings wherever possible. Our team have years of experience helping contractors, so call today on 01442 275789 or email newbusiness@sjdaccountancy.com for details of how we could help you.

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