• Home
• NZ Economic Development
• Small & Medium Enterprises
• Structure and Dynamics
• Archive
• Structure and Dynamics - 2003
• Transition Rates

• Small & Medium Enterprises

• Structure and Dynamics

• Archive

• Structure and Dynamics - 2007
• Structure and Dynamics - 2006
• Structure and Dynamics - 2005
• Structure and Dynamics - 2004
• Structure and Dynamics - 2003
• Structure and Dynamics - 2002
• Structure and Dynamics - 2001
• Structure and Dynamics - 2000
• Structure and Dynamics - 1999

Only a few small firms graduate into larger size brackets each year

The following series of graphs illustrate the transition of enterprises from their initial size in 1995 through to 2002. For example, the first graph shows the transition in size of all firms that employed 0-5 FTEs in 1995, giving the proportion that then fell into each of the six size categories in the years 1997-2002. Five further graphs follow with the same interpretation for firms in each of the other size groups in 1995. Only enterprises still operating in each year are included in the statistics.

Of those employing 0-5 FTEs in 1995, only a small proportion graduated into larger size brackets, with 95.1 percent of these firms still employing 0-5 FTEs in 1997, 94.4 percent in 1998, 93.5 percent in 1999, 92.9 percent in 2000 and 92.3 percent in 2001 and 91.7 percent in 2002.

Figure 21: Transition Rates - Enterprises with 0-5 FTEs in 1995

Firms with 6-9 FTEs are the least likely to remain the same size...

Of all enterprises with 6-9 FTEs in 1995, 53.9 percent remained in the same size bracket through to 1997, 49.0 percent in 1998, 46.5 percent in 1999, 43.3 percent in 2000, 41.8 percent in 2001 and 40.0 percent in 2002. Of all size groups, those employing 6-9 FTEs in 1995 were least likely to remain the same size through to 2002, suggesting that this size bracket may be a transitional state for firms. Over the period from 1995 to 2002, 24.4 percent of firms expanded to employ greater than 9 FTEs and 35.7 percent contracted to employ between 0 and 5 FTEs.

Figure 22: Transition Rates - Enterprises with 6-9 FTEs in 1995

...48.7% of firms with 10-19 FTEs remained the same size...

By 2002, of firms employing between 10 and 19 FTES in 1995, 48.7 percent remained the same size, 30.2 percent contracted and 21.1 percent expanded.

Figure 23: Transition Rates - Enterprises with 10-19 FTEs in 1995

...63% of firms with 20-49 FTEs remained the same size....

2.1 percent of enterprises with 20-49 FTEs in 1995 grew to have over 100 FTEs in 2002, while 8.2 percent shrank to have only 0-5 FTEs. Over the period to 2002, 59.7 percent remained the same size, while 27.7 percent contracted and 12.4 percent expanded.

Figure 24: Transition Rates - Enterprises with 20-49 FTEs in 1995

...49.5% of firms with 50-99 FTEs remained the same size...

49.5 percent of enterprises employing between 50 and 99 FTEs in 1995 remained in the same size bracket in 2002, while 29.2 percent contracted and 21.5 percent expanded.

Figure 25: Transition Rates - Enterprises with 50-99 FTEs in 1995

...and 77.9% of firms with 100+ FTEs remained the same size

Of those enterprises that employed greater than 100 FTEs in 1995, 77.9 percent still employed more than 100 FTEs in 2002. 10.5 percent contracted to employ 50-99 FTEs, 7.6 percent to employ 0-5 FTEs, 3.5 percent to 20-49 FTEs, 0.7 percent employed 10-19 FTEs, and less than 1 percent to employ 6-9 FTEs.

Figure 26: Transition Rates - Enterprises with 100+ FTEs in 1995

The following table gives the proportion of those firms surviving from 1995¹¹ to 2002 that expanded, remained the same size, or contracted over the period.

Table 4: Transition of Firms 1995-2001

¹¹Those firms who have ceased to exist at any time between 1995 and 2001 are not incorporated in this table. Also note that where an enterprise grows or shrinks but remains within its size category it will be recorded as changing size in this table (whereas this is not the case with the preceding set of charts).