Statistical Office of the European Communities (Eurostat)

Unit G2: European businesses

2920 Luxembourg LUXEMBOURG

The annual Business demography data collection covers variables which explain the characteristics and demography of the business population. The methodology allows for the production of data on enterprise births (and deaths), that is, enterprise creations (cessations) that amount to the creation (dissolution) of a combination of production factors and where no other enterprises are involved. In other words, enterprises created or closed solely as a result of e.g. restructuring, merger or break-up are not considered. The data are drawn from business registers, although some countries improve the availability of data on employment and turnover by integrating other sources.

Until 2010 reference year the harmonised data collection is carried out to satisfy the requirements for the Structural Indicators, used for monitoring progress of the Lisbon process, regarding business births, deaths and survival. Business demography also delivered the key information for policy decision-making and for the indicators to support the Europe 2020 strategy. It also provides key data for the joint OECD-Eurostat "Entrepreneurship Indicators Programme".

In summary, the collected indicators are as follows:

• Population of active enterprises
• Number of enterprise births
• Number of enterprise survivals up to five years
• Number of enterprise deaths
• Related variables on employment
• Derived indicators such as birth rates, death rates, survival rates and employment shares
• An additional set of indicators on high-growth enterprises and 'gazelles' (high-growth enterprises that are up to five years old)

The complete list of the basic variables, delivered from the data providers (National Statistical Institutes) and the derived indicators, calculated by Eurostat, is attached in the Annexes of this document (see Business demography indicators). 

Geographically EU Member States and EFTA countries are covered. 

As of 1 February 2020, the United Kingdom is no longer part of the European Union. You may still find reference to aggregated data for the EU with 28 Member States (EU28) and UK data in the Business demography statistics. In particular, content created before 1 February 2020 refers to periods when the United Kingdom was a Member State, and therefore remains valid. However, the EU28 aggregates within BD domain will neither be calculated for reference period 2019 and after, nor the UK data will be revised for the available reference periods.

The methodology laid down in the Eurostat-OECD Manual on Business Demography Statistics  is followed closely by most of the countries (see Country specific notes in the Annexes).

 NACE Rev. 1.1 was used up to reference year 2007. From 2008 onwards NACE Rev.2 classification (Statistical Classification of Economic Activities in the European Community) is used for all indicators.  

The Regional breakdowns of national business demography data at NUTS2 and NUTS3 level is is based on the Nomenclature of Territorial Units for Statistics (NUTS). NUTS 2010 was used up to reference year 2010 and from 2011 onwards NUTS 2013 was used, form January 2018 all regional data are transmitted and published in NUTS 2016.

Country codes and names are based on the interinstitutional style guide.

Starting with the reference year 2008, data cover NACE Rev. 2 (Statistical Classification of Economic Activities in the European Community) sections B to N (excluding activities of holding companies - K64.2). Data for sections P, Q, R and S are provided on a voluntary basis. Number of newly born enterprises and related employment figures are available also for reference years 2004-2007.

 NACE Rev. 1.1  was used up to reference year 2007 covering the data for sections C to K (excluding activities of holding companies - K74.15). Sections M, N and O were transmitted on a voluntary basis and therefore not available for all countries.

The term business demography is used here to cover a group of variables which explain the characteristics and demography of the business population. The creation of new enterprises and the closure of unproductive businesses can be seen as an important contributor to business dynamism. In addition to studying the population of active enterprises, the counts and characteristics of enterprise births and deaths are examined. Special attention is paid to the impact of these demographic events on employment. In order to provide information on the impact of enterprise births, their development will be followed for five years in order to see how they survive and grow.

A methodology has been developed for the production of data on enterprise births (and deaths), that is, enterprise creations (cessations) that amount to the creation (dissolution) of a combination of production factors and where no other enterprises are involved. In other words, enterprises created or closed solely as a result of e.g. restructuring, merger or break-up are not included in this data. The complete Eurostat-OECD Manual on Business Demography Statistics is available from the Eurostat website. The methodology and definitions are based on those of the Business Registers Recommendations Manual and Glossary, because the Business Registers serve as the sources for the Business Demography data.

The harmonised data collection (started in 2002) aims to provide comparable data on business demography for European Union (EU) and European Free Trade Association (EFTA) members. In particular it aims to satisfy the anticipated requirements for the indicators used for supporting the Europe 2020 strategy. It also provides key data for the joint OECD-Eurostat "Entrepreneurship Indicators Programme".

The definitions of the concepts of births, deaths, survivals and activity are as follows:

Enterprise

The enterprise is the smallest combination of legal units that is an organisational unit producing goods or services, which benefits from a certain degree of autonomy in decision-making, especially for the allocation of its current resources. An enterprise carries out one or more activities at one or more locations. An enterprise may be a sole legal unit.

Enterprise Birth

A birth amounts to the creation of a combination of production factors with the restriction that no other enterprises are involved in the event. Births do not include entries into the population due to mergers, break-ups, split-off or restructuring of a set of enterprises. It does not include entries into a sub-population resulting only from a change of activity.

A birth occurs when an enterprise starts from scratch and actually starts activity. An enterprise creation can be considered an enterprise birth if new production factors, in particular new jobs, are created. If a dormant unit is reactivated within two years, this event is not considered a birth.

Employer Enterprise Birth

Birth of an enterprise with at least one employee. This population consists of enterprise births that have at least one employee in the birth year and of enterprises that existed before the year in consideration, but were below the threshold of one employee.

In other words, "employer enterprise births" comprise all "enterprise births" of a given year minus the non-employer births of the same year plus former non-employer enterprises that have become employers in the given year. Therefore the dataset on "employer business demography" does not have any size class "0 employees" but usually has higher number of "employer births" particularly in size class "up to 4 employees".

Enterprise Death

A death amounts to the dissolution of a combination of production factors with the restriction that no other enterprises are involved in the event. Deaths do not include exits from the population due to mergers, take-overs, break-ups or restructuring of a set of enterprises. It does not include exits from a sub-population resulting only from a change of activity.

An enterprise is included in the count of deaths only if it is not reactivated within two years. Equally, a reactivation within two years is not counted as a birth.

Employer enterprise death

An employer enterprise death occurs either as an enterprise death with at least one employee in the year of death or as an exit by decline, moving below the threshold of one employee.

This is the opposite event to the employer enterprise birth. "Employer enterprise deaths" comprise all "enterprise deaths" of a given year minus the non-employer deaths of the same year plus former employer enterprises that have become non-employers in the given year. Therefore the dataset on "employer business demography" usually has higher number of "employer deaths" particularly in size class "up to 4 employees" than the complete dataset covering also non-employers in size class "0 employees".

Survival

In the Business Demography context, survival occurs if an enterprise is active in terms of employment and/or turnover in the year of birth and the following year(s). Two types of survival can be distinguished:

1. An enterprise born in year xx is considered to have survived in year xx+1 if it is active in terms of turnover and/or employment in any part of year xx+1 (= survival without changes).

2. An enterprise is also considered to have survived if the linked legal unit(s) have ceased to be active, but their activity has been taken over by a new legal unit set up specifically to take over the factors of production of that enterprise (= survival by take-over).

Activity

Within the Business Demography context, activity is defined as any turnover and/or employment in the period from 1st January to 31st December in a given year. This definition complements the concept of activity in the Business Registers glossary. In 'employer business demography' an enterprise is considered active as long as it has at least one employee.

High-Growth Enterprises and Gazelles (growth can be measured by the number of employees or by turnover)

1. Growth by 10% or more and 10 employees in the beginging of the growth

Commission implementing regulation (EU) No 439/2014 set the definition and compalsory collection of high-growth enterprises with at least 10 employees in the beginning of their growth and having average annualised growth in number of employees greater than 10% per annum, over a three year period. 

In addition, on a voluntary basis, the high-growth enterprises that are up to five years old (Gazelles) with average annualised growth (turnover or employment) greater than 10% per annum, over a three year period are available.

2. Growth by 20% or more and 5 or 10 employees in the beginging of growth

The definitions on these voluntary delivered variables are laid down in the Eurostat-OECD Manual on Business Demography Statistics. All enterprises with average annualised growth greater than 20% per annum, over a three year period should be considered as high-growth. Medium growth enterprises are defined with the average annualised growth mentioned above between 10 and 20%.

Data are also collected on so-called Gazelles, i.e. high-growth enterprises that are up to five years old and with average annualised growth greater than 20% per annum, over a three year period. Those medium growth enterprises which are up to five years old are called young medium growth enterprises.

As the growth factor defining high growth does not depend on the size of the enterprise, a meaningful threshold has to be set. Otherwise, for instance, a small enterprise growing from 1 to 2 employees over three years would already be considered as a 'high growth enterprise'. Thus, a threshold of 10 employees (up to the reference year 2006) / 5 or 10 employees (the reference year 2007 onwards) is applied, i.e. only those enterprises that had at least 5 or 10 employees at the beginning of the three-year observation period are covered.

The statistical unit is the enterprise. In practice, many countries report data on legal units, which in most cases coincide with the enterprise.

The target population is the private sector economy. The business registers of the participating countries are used as data sources. The data sets from the business registers are processed to produce data on births, deaths and survivals, as well as to obtain related indicators on employment. In principle there is no size threshold although in practice many countries' business registers do have a low threshold due to the coverage criteria of sources used to establish and update the register. In the additional datasets on employer business demography, the threshold is set to one employee at any time of the reference period. As mentioned above, a threshold of 5 or 10 employees is used to define the population of high-growth enterprises and 'gazelles'.

In principle all EU Member States and EFTA countries are covered. In practice not all Member States have participated in the first harmonised data collections, because they were delivered on a gentlemen's agreement. EU aggregate is also calculated based on the available information and changes according to the context.

Data are generally available from 1997 for enterprise stocks and deaths, from 1998 for enterprise births and from 1999 for survivals.

Data on employer enterprises and high-growth enterprises are available from 2005 onwards.

Not applicable.

Basic variables (active, birth, death and survival enterprises and their employment) are in absolute figures. Derived indictors are expressed in percentages. The complete list of all business demography indicators is attached in the Annexes.

The basic reference period is the year. There are two types of variables in the data set, namely the number of enterprises and employment (persons employed and employees).

The population of active enterprises refers to any enterprises that were active at any time in the reference period, even for a limited time.

Births refer to units born 'from scratch' without the involvement of other units during the reference period.

Deaths relate to real enterprise deaths during the reference period. However deaths are not confirmed until after two years to exclude the possibility of a unit reactivating. Therefore, final data on deaths and related variables are reported one year later than the other data.

Employment is an annual average head count calculated over the operating period or calendar year.

Up to reference year 2006 data have been collected under gentlemen's agreement within the context of the development of Structural Business Statistics. 

Regulation (EC) No 295/2008 of the European Parliament and of the Council of 11 March 2008 concerning structural business statistics (recast), Annex IX, provides a legal basis for the data collection.

Commission implementing regulation (EU) No 439/2014 of 29 April 2014 ensures data collection on employer enterprises (with at least one employee), high-growth enterprises (more than 10% annual growth over three years) and their employment.

Eurostat makes available all non-confidential data on its dissemination website.

Regulation (EC) No 223/2009 on European statistics (recital 24 and Article 20(4)) of 11 March 2009 (OJ L 87, p. 164), stipulates the need to establish common principles and guidelines ensuring the confidentiality of data used for the production of European statistics and the access to those confidential data with due account for technical developments and the requirements of users in a democratic society.

Confidentiality - if data are of truly confidential nature according to the above mentioned regulation, they have to be flagged confidential, and they will not be published by Eurostat.

Not available

Not available

In line with the Community legal framework and the European Statistics Code of Practice Eurostat disseminates European statistics on Eurostat's website (see item 10 - 'Accessibility and clarity') respecting professional independence and in an objective, professional and transparent manner in which all users are treated equitably. The detailed arrangements are governed by the Eurostat protocol on impartial access to Eurostat data for users.

Annual

News releases on-line

Statistics Explained article 

Please consult free data on-line or refer to contact details.

Not applicable.

Key Figures on European Businesses.

See also: http://ec.europa.eu/eurostat

The Eurostat-OECD Manual on Business Demography Statistics outlines the methodology to be used for the production of the data in the national statistical institutes. For more information, please contact the domain manager.

Quality profile on 'Business Demography' statistics is available on Eurostat's website.

As from the reference year 2008 Member States have been providing Eurostat with regular (annual) quality reports covering most of the categories of the ESS Standard for Quality Reports. Eurostat prepares a summary quality reports which is discussed in a yearly meeting with Member States.

According to the information available from the quality reports, data are of good or very good quality.

Business demography data collection was developed in cooperation with the main users. The information is used by different users (European Commission services, international organisations, ECB, national governments and central banks, economic analysts in private companies and financial institutions, journalists, researchers etc.) and serves different purposes.

Eurostat has not organized a user survey yet.

Data was collected on a voluntary basis until and including reference year 2006. Not all Member States are therefore covered yet. Starting with reference year 2007 data collection has become mandatory. Backdata on birth for the years 2004-2007, according to NACE Rev.2, were also required.

Starting with the reference year 2008, all Member State should provide business demography data, except those variables for which countries have derogations.

Data are taken from the business register and therefore the accuracy depends on its quality. In addition, the methodology and definitions for the source data are based on the Eurostat-OECD Manual on Business Demography Statistics which provides the guidelines to be used for the data production. The general use of the Manual by the Member States may ensure high accuracy of the data collected.

Not applicable.

Not applicable.

Data generally should be published within 2 calendar years of the end of the reference year.

In the case of indicators on enterprise deaths, a two year lag is foreseen in the methodology in order to confirm whether a presumed death is in fact reactivated. For this reason information on final deaths is generally available later than the stock of enterprises and enterprise births.

Regulation (EC) No 295/2008 and its implementing regulation (EU) No 439/2014 require the EEA countries to send annual data, within the following months after the end of the reference year:

• 12 - preliminary high-growth enterprises,
• 18 - active, birth and survival enterprises; preliminary death enterptises; final high-growth enterprises,
• 20 - active, birth and survival employer enterprises; preliminary death employer enterprises,
• 30 - final death enterprises,
• 32 - final death employer enterprises.

Although the business demography statistics is produced in a unified way based on the recommendations manual, some differences stemming from the data sources can occur that restrict the data comparability across countries.

Different administrative sources depending on national law, as well as surveys, are used to update the business registers. More importantly the presence of different size thresholds in business registers may have a substantial impact on comparability especially on data for start-ups.

The Country specific notes document (see Annexes) provides brief information at national level regarding the methodology used for the data production on Business Demography.

Restrictions in comparability over time are related to the construction of the indicator and the small size of the time series presently available.

Data on the population of active enterprises (variable 11 91 0) overlap with the data on the number of enterprises of the SBS data (variable 11 11 0). Differences are due to the different methodologies used in defining the populations and collecting the data.

In between Eurostat releases, Member States may revise their figures; Eurostat publishes the new Member States' figures shortly after reception but does not recalculate the EU aggregates until the next scheduled EU release (twice per year). Geographical coherence may thus be lost for a brief period. In turn, a certain stability of annual aggregates is assured.

In general, business demography data collection does not impose additional burden and cost, as the basic information is available in the national business registers.

Where errors have been found in previously published data, or where there have been improvements in compilation methods, data have been revised.

Revisions can be carried out by Member States, information on any such changes are to be provided in the methodological reports accompanying the data.

Data were provided in all cases by national statistical institutions. The national business registers serve as the sources for the business demography data. Business registers hold data on the creation and cessation of enterprises, their economic activity, their legal form, employment, turnover, and other information. No samples are drawn from the registers, but the full registers are processed.

Some differences in the coverage among the countries can occur. Different administrative sources depending on national law, as well as surveys, are used to update the business registers, and in some countries VAT thresholds for registration apply (see Country specific notes in the Annexes).

Annual

Although practices vary somewhat between countries the data processing starts by establishing a series of annual snapshots of the business register. The populations in each of these snapshots are then matched in order to identify the target populations and to be able to follow each unit across the time period considered. Other sources may then be used to update some of the information (such as employment or turnover). Data for active enterprises are obtained from the business registers by checking for activity. A unit is considered active if it shows employment and / or turnover during any time of a calendar year. Births and deaths are separated from other creations and cessations by eliminating mergers, take-overs, break-ups and split-offs. ID numbers are used to identify all new enterprises. Thus, reactivations of inactive units can be followed as well. A reactivation of an enterprise after more than two years is considered a birth, while a death is confirmed only after two years of inactivity.

It should be noted that the survival enterprises are classified to their activity and size strata in the year they were born. For the evaluation of survival and growth rates these classifications are fixed for the duration of the study. For the population of active/birth/death enterprises (and the indicators related to enterprise deaths) these two classifications (activity and size) reflect the classifications in each reference year.

Data are validated on reception. This involves a pre-treatment to align received data to the standard transmission format when this has not been fully respected. If activity and size aggregations have not been provided these are calculated. If they have been provided they are checked for coherency. In addition to the standard NACE classification, some special activity aggregates are available, notably Sections C to E, Sections G to K, Sections M to O, various ICT aggregates, and various special aggregations of services activities such as Knowledge Intensive Business Services.

Coherence between variables is also verified for example to ensure that there are not more surviving enterprises in a stratum than there were births the previous year. A number of apparent inconsistencies exist for methodological reasons. For example if employment is measured in full-time equivalents then it is possible to have a lower level of employment in a stratum than there are enterprises. All inconsistencies are verified with the data provider and methodological notes made of any practices that explain apparent incoherence.

A check is done to ensure that all data sets are complete in terms of variables provided and activity and population coverage. In the event that records are missing it is verified whether this is because the data is not available or because in fact there are no enterprises in the strata concerned. In the case of not available data it is recorded as missing and in the case of no enterprises present in the strata it is recorded as a zero.

Starting with the reference year 2009 EU aggregates are available.

Data related to the number of enterprises as well as related employment data are reported as units.

Not applicable.

Due to different revision policy for the European aggregates and the Member States' data, there may be a difference between the European aggregate and the appropriate sum of national data between updates.