the 1980s and the years since then have also been characterised by structural changes in the uk economy that have had an impact on the small-firm sector. these changes have included:the growth of the service sector and the decline of manufacturing; increased use of outsourcing and cintracting out; and 'creative destruction' as old industries like textiles and coal mining declined and were replaced by new knowledge-based and technology-based industries. structural changes such as these have tended to foster a decline in large firms and an increase in small ones. they form part of a move away from large centralised organisations relying on vertical integration and hierarchy which are usually good at delivering efficiency gains but poor at innovation.