The Co-operative Economy, published annually by Co-operatives UK, is the nation’s only comprehensive report on the UK’s co-operative sector. It reveals turnover, membership and employee figures for thousands of businesses across the UK. Data is tracked to provide historical context and trends, as well as broken down into sectors and geographic areas. For increased transparency all the numbers can be explored via an open data platform, while a detailed breakdown of the methodology used in the datasets is also provided. But just as co-operatives are about more than the bottom line, this report is about more than the numbers. Through case studies, identification of emerging trends and latent needs, alongside relevant data analysis, we make the case for a more co-operative United Kingdom – a nation that is more inclusive; promotes a fairer distribution of wealth; and offers solutions to some of the UK’s most pressing issues.

There are now 7,226 independent co-operatives operating across the UK, with a combined turnover of £36.1 billion – up more than £800 million on 2017 levels. The sector is also a significant employer, with almost 235,000 people earning their livelihoods directly through co-operatives.

Ownership of the UK’s co-operatives is at record levels with the number of active members at 13.1 million – the equivalent to a fifth of the UK’s population. Growth has been driven by the UK’s largest customer owned high street retailer, The Co-op, alongside burgeoning membership figures for credit unions.

Co-operatives are businesses owned and run by people like us – customers, employees, suppliers, residents, farmers, graphic designers, taxi drivers… These people, the members, decide together how the business operates and how its profits are used. But what does this mean?

It means co-op businesses are created to serve a purpose. In practice this means co-operatives are created to provide decent work; they are entwined in the communities in which they operate; they offer people control over the things that matter to them.

The latest figures reveal that co-operative start-ups are almost twice as likely to survive their first five years when compared to companies. Only 44.1% of companies make it through those difficult opening years while 80.4% of co-ops are still going strong.

Co-ops remain a resilient force and a solution to problems across the economy. Credit unions offer an alternative to spiralling debt fuelled by pay-day loans. Farmers are able to work together to create and retain more value in food supply chains. Freelancers can make work less precarious by pooling their resources. Consumer co-ops put more of their profits back into the communities in which they operate. Platform co-ops allow users to benefit rather than distant shareholders or investors.

So, despite providing solutions to so many problems, with record membership figures and demonstrating incredible resilience, why do co-ops remain the best kept business secret in the UK?

The co-operative movement was born out of a vision for a better social system. That pioneering spirit must be evoked once again to increase public and political awareness and support for co-operatives. Co-operatives must come together like never before to speak with a collective voice and build a stronger support network for start-ups and established businesses. It is co-operatives, collectively, that must shout loudly to make the case for co-operatives. We must do it ourselves.

Co-operatives span the economy. They operate in robotics, in farming, in graphic design, in education, in housing, in sport and many other sectors.There are three million co-operatives worldwide with more than 1.2 billion members while the top 300 co-operatives and mutuals report a combined turnover of $2.1 trillion US dollars. Here in the UK the strongest sector in relation to turnover is retail. Driven by The Co-op and John Lewis, supported by other successful and longstanding independent co-operative retailers, turnover has grown from £25.0 billion to £25.4 billion over the past year.

In sheer numbers, co-operatives are most prevalent in the membership associations, social clubs and trade unions sector. These associations and clubs are borne out of a desire and need to create something that fulfils a local need. In a similar vein, the growth in the number of community pubs and shops is marked as people come together to save local assets through community shares.

It is this ability to provide unique solutions that needs to be fostered in other sectors: in a care system that is failing its users; in a platform economy that enriches the few but is used by the many; and in a gig economy that has helped foster an environment in which 77% of the self-employed live in poverty.

A unique set of circumstances affect the community energy sector. The number of community energy organisations across the UK has fallen for the first time since just a handful were in existence back in 2011. Just six were born in 2017 – the least since the start of the decade as fall-out from the government’s decision to slash subsidy rates and tax relief reaches its zenith. Despite the reduction in the number of energy co-ops from 255 to 247, turnover is up from £13.4 million to £14.5 million.

While the bulk of the UK’s thousands of independent co-operatives are based in England, we are witnessing growth and support across the devolved nations. Scotland leads the UK in worker buyouts, averaging one a month with around 100 more set to follow in the footsteps of organisations like technical textiles manufacturer Scott & Fyfe. There are 573 co-operatives based in Scotland with a combined turnover of £2.4bn.

The number of co-ops in Scotland has increased by just under 1% though turnover has fallen by around £65 million. The downturn is predominantly due to a significant drop in turnover by First Milk. However, the farming co-op has posted strong operating profit figures after putting in place a new business strategy, the sale of loss-making subsidiaries and implementing an effective co-operative governance structure.

There is an emerging trend of resilience in co-ops with new Scottish co-ops almost one and a half times as likely as start-up companies to survive their first five years (65% survival rate compared to 46%).

In Wales, alongside modest turnover growth, membership levels have increased by 5% and a bright future is predicted in the important area of co-operative care. The Welsh government funds Care to Co-operate, a programme to assist the development of new care co-ops, while local authorities are required by law to support the development of co-ops in the care sector.

Northern Ireland’s strong credit union sector has driven the increase in the number of co-op owners, with total membership up 4%. England has also experienced membership growth, with more than 600,000 new co-op members since the start of 2017. The Co-op has powered this spike, with the retailer’s focus on returning to its roots, with increased value for members and their communities, attracting hundreds of thousands of new owners.

Co-operatives provide decent work and new co-operative businesses are almost twice as likely as start-up companies to survive their first five years. Just 44% of companies survive the difficult early years while 80% of co-operatives are still going strong, demonstrating the sustainability of the work they provide.

Workers’ co-operatives, those co-ops owned by the workers, continue to prosper with a steady increase in turnover year on year and now closing in on the £11 billion mark. Worker co-ops can be more productive, motivated and committed than other firms because they align the interests of the workers with the success of the business. They have flatter management structures, motivated workers and a stronger culture of solidarity and self-responsibility.

The nature of work continues to change and co-operatives can play an important role in this changing climate. More than seven million people are now engaged in precarious work and 77% of those are classed as living in poverty. Co-operatives offer an alternative. ‘Umbrella’ co-operative models for supporting freelancers and other precarious workers are gaining traction across the world, with examples like the Belgium-based Smart.

Partnerships between co-operatives and trade unions offer protection for precarious workers. Indycube, a rapidly growing network for freelancers and the self-employed predominantly in Wales, is working with the trade union Community to offer its members a range of benefits including advice on tax, insurance, pensions and employment law.

Freelancers are also coming together to form their own co-operatives. These businesses, like Open Data Services Co-operative, demonstrate that the self-employed are stronger together.

Increasingly people are looking to retain ownership and wealth at a local level. Since 2012 communities across the UK have raised more than £107.9 million through community shares to save or create 346 local assets. This growing movement involves tens of thousands of people and ambition is growing. Typically used as a vehicle to save local pubs and shops, or for community energy, the use of community shares is broadening.

From GlenWyvis Distillery to Portpatrick Harbour to Jubilee Pool, communities are coming together to create local distilleries, to save their harbours and lidos. They are doing this with increased confidence with 70% of all share offers in 2017 awarded the Standard Mark – the rubberstamp for share offers meeting national standards of good practice.

We are also witnessing a step change in the amount of institutional investment being directed into community share offers. There has always been a modest institutional dimension to the community shares market through Co-operative Community Shares Fund and complementary loan funds with occasional equity investments from the likes of Resonance, Social Investment Business and Architectural Heritage Fund.

The landscape changed when Co-operatives UK’s Community Shares Unit began working with charitable trust Power to Change on a pilot scheme in 2017. Through this Booster Programme the charitable trust matched – with an upper limit of £100,000 – the amount communities raised through their share offer. On the ground this means co-operatives like Leeds Community Homes and Sutton Community Farm have been boosted to the tune of £100,000 and £49,000 respectively.

The amount of institutional funding increased five-fold with approximately £2m of institutional investment channelled into community share offers over the last 12 months. This is a trend which is set to continue with the extension of the Community Shares Booster Programme and a growing number of public funding bodies, social investment specialists, banks, ethical investment funds, charities and corporations investing in community shares, recognising it as a valuable model to support community enterprise.

Government and the business community can learn from co-ops. Mistrust in business has accelerated over the past 40 years. In 1986, 53% of people agreed that big business benefits business owners at the expense of its workers. That rose to 61% by 1996 and today stands at 76%.

Co-operatives are different. Values and principles are built into the very fabric of their existence which is why the focus on community and sustainability has an authenticity that other businesses struggle to match. Customer-owned retail societies, those co-ops which include The Co-op – the UK’s most visible and best known co-operative – enjoyed an increase in turnover of £200 million to £13.9 billion. But it is not simply their commercial success which makes these businesses stand out.

Retail societies give their members a chance to consume in a way that is good for people and planet. They also distributed almost 12% – more than £5.7 million – of their profits back to the communities in which they operate in 2017. Major supermarket rivals Tesco, Morrisons, Sainsbury’s and Marks and Spencer gave back less than 6% of their profits.

The value, in the broadest sense of the word, offered by retail societies increasingly resonates with consumers. Powered by The Co-op, but with significant contributions from the independent retail societies, membership levels have leapt by 9%, with more than 700,000 new people taking membership levels close to 8.5 million.

Co-ops are a way for farmers to work together to create and retain more value in food supply chains – making their businesses more productive, profitable and sustainable. However, the number of farmer co-ops operating in the UK has fallen for the fifth successive year, down to 420 from a 2014 high of 445. The number of farmer owners overall is also in decline, with a drop of 2.6% to 142,999.

This trend is in stark contrast with our European neighbours and important farming nations further afield. The market share of the UK’s farming co-operatives, at just 6%, is a fraction of other European Union nations including Germany (45%) and France (55%). Those nations with a stronger market share are experiencing stronger growth, with the United States Department of Agriculture reporting that the UK achieved an average annual growth in ‘total factor productivity’ of 0.8% from 2001 to 2012. This compares unfavourably with France (1.7%), Germany (1.8%) and the United States (2%) over the same period.

Defra recognises that the UK is significantly out of step with its international competitors and, following concerted lobbying efforts from Co-operatives UK and its farmer members, is supporting more collaboration in the sector. The announcement of a £10 million government fund to support farmer co-operation arrived in early 2018 but more support is required to reverse the trend of declining farmer co-op numbers.

The UK’s housing market is broken. Owner occupancy levels for young adults have collapsed while sky high rents compound the problem. Co-operatives must form part of the solution. Twenty-one housing co-ops were created in 2017 to take the UK-wide total to 685, with membership levels close to 70,000.

Community land trusts (CLTs) like Lune Valley CLT and Above Derwent CLT are also on the rise. A form of community-led housing, run by ordinary people to develop and manage homes as well as other assets, CLTs act as long-term stewards of housing and other local assets to ensure they remain genuinely affordable. The number of trusts has rocketed from just 16 in 2008 to 240. There are 820 CLT homes with a further 5,330 in the pipeline – and more than 100 local authorities now actively support community-led housing.

Housing for students is also another strong development area. A new national body, Student Housing Co-ops, was created in early 2018. It aims to increase the capacity of student housing co‑ops from 150 to 10,000 beds, providing lower cost accommodation and putting the students themselves in control. The national body will own the property portfolio, with homes leased back to local student groups.

The UK’s co-operative sector gives people more influence over their work, their housing, their communities and the businesses they use. Co-operatives are twice as likely to survive the difficult first five years of existence as other businesses. They give people a greater stake in the economy with a stronger sector helping reduce inequalities in wealth and power. But the co-operative sector remains a tiny fraction of the economy as a whole. This needs to change.

The change starts here and you can help. By sharing this report and the statistics collated by Co-operatives UK you will help raise awareness of co-operatives. We have powerful messages to send to government, to consumers, to businesses and with vocal support the co-operative economy will grow.