Entry to and Exit from Business Demographic Statistics
SMEs account for the majority of all entries and exits.
Entry and exit statistics relate to the movement of firms into and out of the Statistics New Zealand business demography dataset. The analysis of business demography is limited to economically significant enterprises - those that meet at least one of the following criteria:
- GST expenses or sales greater than $30,000 annually
- rolling mean employee count of greater than three
- in a GST-exempt industry (except for residential property leasing and rental)
- part of a group of enterprises
- registered for GST and involved in agriculture or forestry
Entries and exits are not start-up or failure statistics…
Entry and exit statistics are not start-up and failure statistics and should not be interpreted as such.
Data on the entry and exit of firms include administrative changes such as restructuring and changes of ownership, as well as genuine business start-ups and closures. When businesses register for GST and are added to the dataset, they are given a new reference number. Company restructuring and changes of ownership can result in a new GST registration being filed for an existing business. The proportion of entries and exits can be established in business demography statistics by matching the GST registration reference numbers for one year with those of the previous year. The purpose of presenting these statistics is to show the location of entry and exit activity in the economy.
…but a new series will produce that soon.
Current work underway at Statistics New Zealand to align with international best practice will improve statistics on new businesses and business closures. The Longitudinal Business Frame attempts to identify births and deaths of enterprises due to administrative churn (such as company restructuring and changes of ownership), so that genuine business start-ups and closures/failures can be better identified. An experimental series is anticipated in May 2006. Once Statistics New Zealand publishes an official series based on the Longitudinal Business Frame, they will be incorporated into future editions of Structure and Dynamics.
Firms with 5 or fewer employees dominated entries and exits.
Similar to previous years, enterprise entries and exits are dominated by firms employing 5 or fewer employees, accounting for 94.6 percent of entries and 96.2 percent of exits at February 2005.
Figure 14: Enterprise Entries, as at February 2005
| EC Size Group |
Enterprise Entries |
| 0 |
45,528 |
| 1-5 |
9,482 |
| 6-9 |
1,549 |
| 10-19 |
1,040 |
| 20-49 |
421 |
| 50-99 |
69 |
| 100-499 |
48 |
| 500+ |
7 |
| [Total] |
58,144 |
Figure 15: Enterprise Exits, as at February 2005
| EC Size Group |
Enterprise Exits |
| 0 |
42,494 |
| 1-5 |
3,782 |
| 6-9 |
832 |
| 10-19 |
602 |
| 20-49 |
299 |
| 50-99 |
56 |
| 100-499 |
27 |
| 500+ |
5 |
| [Total] |
48,097 |
Enterprise entries outnumbered exits.
There were 10,047 net entries into the Business Demography dataset as at February 2005.
Figure 16: Enterprise Entries and Exits, February 1998-2005
| Reference period |
Enterprise Entries |
Enterprise Exits |
| 1998 |
58,222 |
38,700 |
| 1999 |
50,731 |
47,818 |
| 2000 |
66,868 |
42,007 |
| 2001 |
47,324 |
48,280 |
| 2002 |
50,522 |
43,145 |
| 2003 |
53,972 |
40,356 |
| 2004 |
67,559 |
38,220 |
| 2005 |
58,144 |
48,097 |
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