While a swathe of redundancies engulf the developed world in the wake of the global economic downturn, many of those set free from their contracts of employment are turning their previously dormant business ideas into reality and becoming entrepreneurs.
Hard-hit industries such as the financial sector are witnessing the highest conversion of redundancies to entrepreneurs, with hundreds of City workers turning their back on a narrowing jobs market to blaze their own trail.
Lee Shuell, a former employee of a major mortgage lender, was made redundant after a 19-year stint working for a company that lent upwards of £70 million daily. Following a three-month period of unsuccessful job applications and recruitment agency cul-de-sacs, Shuell stumbled across his holy grail, an advert for a lettings agency franchise.
Talking to BusinessWings, Shuell says the newly redundant should, above all, try to do something they enjoy: “I had always wanted to run my own business, but due to having very good jobs I never had the chance to follow it up.
“I then came across Belvoir Lettings.
“To cut a long story short, I bought the Oldham franchise and opened in November 2008. In the short time that I have been open I can already see that this is going to be a great success.
“I believe people that have been made redundant should look at what they enjoy doing as a hobby and see if they can make a career out of it.”
In a similar scenario, Mike Mitchell took early retirement from his post at Cheltenham & Gloucester when he foresaw a difficult period looming for the banking industry. Sensing he was at the end of one chapter and the start of another, he fulfilled a lifelong ambition and bought an online art gallery, with his wife.
“We are now responsible for managing the prestigious Knapp Gallery in Regent’s College, London, and providing the artworks for the Malvern Theatres, one of the most successful provincial theatres in the UK,” he explains.
“Banking to art – quite a change, and we love it.”
Mitchell is keen to emphasise the polarity of his previous and current work patterns: “Less than 12 months ago I was managing the entire customer service operation of Cheltenham & Gloucester Plc, circa 1,200 people in the UK and a team of about 600 in India.
“Last year I would have been at home in Lloyds TSB’s boardroom in Gresham St; last week I was having breakfast in Sotheby’s boardroom surrounded by Damian Hurst’s butterflies.”
Heartening stories – but the aforementioned redundant employees turned entrepreneurs both bought into a proven business model, be it a tried and tested franchise concept or an established business with a proven track record.
Starting from scratch is a different challenge altogether.
Starting a business was difficult even in the boom years and only about 20% of start-ups made it past the first three years. And yet, Jayne Davies, who started her own business in the most inauspicious economic circumstances since the Great Depression, is faring rather well.
“I set up a business last year selling a remarkable new slimming product and the business is going from strength to strength,” she explains. She’s about to receive additional help from her soon-to-be redundant husband.
“My husband Peter, who has worked in the steel industry for the last 25 years, has just volunteered for redundancy because he’s also going to be involved in the business.
“It will be remarkably different from what he done all his life, but he’s going to be involved in all aspects.” The credit crunch hasn’t had a uniformly negative impact it would seem.
“The credit crunch has had a bearing on the decision,” says Davies.
“We own two properties and the mortgages have virtually disappeared. “This has put us in a position where he could take is redundancy and be involved in a whole new venture.
And, she adds: “The business is operating on a national level and getting to the stage where I just can’t manage it alone.”
Starting out on your own is a tough proposition, even in the most settled of financial climates.
A helping hand for the fledgling entrepreneur can be found at the Prince’s Trust Business Programme for 18-30 year olds or find more advice on the small business pro website