Research recently carried out by BDO shows that businesses listed on the Alternative Investment Market (AIM) have created an additional 76% jobs over the last five years, now employing almost 390,000 people.
Revenues of AIM-listed businesses have also grown significantly, with an 86% increase over the same five-year period, bringing total revenues to £58bn.
Despite there being a larger proportion of AIM listed businesses in London and the South East, in terms of job growth it was Yorkshire and the East Midlands leading the way, recording job increases of 111% and 87% respectively.
Known as the London Stock Exchange’s junior market, AIM is the most successful growth market of its type in the world. The market celebrates its 25th anniversary next year, and research suggests that investors are liking its new found maturity.
Despite the uncertain economic climate causing a decline in new listings, this research suggests that well-run businesses are succeeding on AIM, with investors seeming prepared to weather the storm and take a slightly longer-term view than they perhaps would have 10 or 15 years ago.
Alongside mid-sized organisations (with revenues of between £10 and £300m) and those who are PE backed, AIM listed businesses are part of the UK’s economic engine. We believe these businesses are being overlooked and undervalued, but their contributions to the economy should not be underestimated.
In a time of unusual political circumstances it is really positive to see such strong growth in such a key market and its contributions to UK employment growth. AIM isn’t for everyone, but our research illustrates the long-term rewards that a listing can provide to the right business.
Paul Eagland is Managing Partner at BDO.