1. Employers, Founders and Gazelles: Developments in Business Demography in Europe Since 2005
20th International Roundtable on Business Survey Frames - Wiesbaden Group on Business Registers
Session 5c, 24/10/2007
Hartmut Schrör, Eurostat

2. Business demography: current status
Business Demography at EU level since reference year 1997
Annex IX of recast Parliament and Council Regulation on SBS
Coverage of employers and non-employers, no threshold
Continued demand for data covering the whole business population

3. New elements in business demography
Business demography based on employers only
Better comparability across countries
Better focus on units that are economically significant
1/3 to 2/3 of business population excluded
High growth enterprises and gazelles
New elements not covered by SBS Regulation => voluntary at EU level
OECD-Eurostat Entrepreneurship Indicators Programme
Eurostat-OECD Manual on Business Demography Statistics

4. Employer enterprises Three concepts of birth and death
Enterprise birth / death: all enterprises, i.e. employers and non-employers. No size thresholds. Current practice.
Employer enterprise birth /death: enterprises with at least one employee.
Economic enterprise birth / death: enterprises with at least two employees.

5. Employers: just drop “0 employees” size class?
Birth rates
Birth rate = newly born employer enterprises / all employer enterprises
Problem: What if an existing non-employer enterprise becomes an employer? Now it would in the denominator but not in the enumerator => birth rate too low.
Solution: “entry by growth”
Death rates
Same problem: What if an employer becomes a non-employer but continues business?
Same solution: “exit by decline”

6. Employer enterprises
How to distinguish between employers and non-employers in practice?
One employee on annual average?
At least half an employee on average?
Any other fraction of 1?
At least one employee at the end of the reference period?
Problem: different administrative sources in EU Member States
Annual averages (rational numbers, integers)
Quarterly, monthly data

7. Employer enterprises Definition of an employer enterprise
An enterprise should be considered an employer enterprise in a given year if it has at least one employee at any time during the reference period from to Its operating period as an employer within a calendar year is the time during which it has at least one employee.
Size classes:
“up to 4 employees”
5-9
10 or more

8. Employer enterprises Remaining issue Way forward
How to set a two employee threshold consistently for economic enterprise births and deaths?
At least 2 on average? … at any time of the year? …
> 1 on average?
Way forward
16 countries to deliver results to Eurostat in January 2008
Release expected in first half of 2008

9. High growth enterprises
Provisional definition
20% average annualised growth over a three year period
Measured in employment or turnover
Gazelles: up to 5 years old
Exclusions
Growth by take-over
Enterprises born in xx-3 (because of low turnover)
Tentative threshold of 10 employees at xx-3

10. High growth enterprises
Way forward
OECD: Sensitivity testing with volunteer NSIs
Threshold
Growth factor
OECD workshop on high growth 19 November
EU: 16 countries to deliver results to Eurostat in January

11. Factors of Business Success - background
Business Demography: births, survivals, deaths, and related employment
Further questions
What are the factors determining the success / survival of newly born enterprises?
What obstacles do newly born enterprises face?
What support to them is most useful?
What is the profile of the successful entrepreneur?
=> FOBS project

12. FOBS - Methodology Target population
Enterprises that were born in 2002 and survived for 3 years, i.e. until the time of the survey in 2005.
Sub-population of enterprises that are still managed by the founder => profile of the successful entrepreneur
Samples drawn from populations of newly born enterprises identified in business registers using the business demography methodology

13. FOBS Questionnaire (1/2)
Start-up conditions
Motivation for start-up
Financing
Difficulties at start-up
Support and advice
Entrepreneur’s characteristics
Education
Experience managing an enterprise
Branch experience
Gender
Age
Citizenship

14. FOBS Questionnaire (2/2)
Present situation
Employment, turnover
Co-operation, networking
Difficulties developing the enterprise
Future plans and expectations
Future of the enterprise (continuing, selling, closing down)
Development of employment, turnover, investments

15. Experience managing an enterprise Start-up difficulties

16. Gender Labour Force Survey vs. FOBS

17. Gender Previous occupation

18. FOBS - Conclusions Successful project
Efficient combination of register based data (3 year-old enterprises as subframe) for targeted business survey
What next?
Focus on access to finance