SMEs Contribution to Employment
The number of FTEs employed by SMEs continues to rise
The number of FTEs employed by SMEs in total increased by 5.4 percent in the year to February 2000, following a rise of 0.2 percent in the previous year. The proportion of total employees hired by SMEs has remained fairly constant over the last few years.
Figure 3. Number of FTEs by Size
Table 2. Annual Percentage Change in Employees by Enterprise Size (Years to February)
| | 1996 | 1997 | 1998 | 1999 | 2000 |
|---|
| 0-5 FTEs | 2.7 | 3.9 | 4.3 | -1.3 | 5.1 |
|---|
| 6-9 FTEs | 2.6 | 0.5 | -0.6 | 2.9 | 6.4 |
|---|
| 10-19 FTEs | 1.8 | 1.5 | 3.5 | 1.7 | 5.3 |
|---|
| 20-49 FTEs | 6.2 | 1.8 | -0.9 | 4.1 | 6.2 |
|---|
| 50-99 FTEs | 3.9 | -0.2 | 1.7 | -3.8 | 3.3 |
|---|
| 100+ FTEs | 2.4 | 2.7 | -0.5 | -1.8 | -0.3 |
|---|
| Total | 3.0 | 2.3 | 1.1 | -0.4 | 3.1 |
|---|
New small businesses create the greatest number of new jobs
Table 3 illustrates the contribution that SMEs made to job creation in the economy between 1995 and 2000. The largest single contributor was new firms employing 0-5 FTEs, which created 194,000 new jobs. Of continuing businesses, the greatest number of new jobs came equally from small and large (100+ FTEs) firms. While small businesses were also the cause of the greatest employment reduction, this was outweighed by the jobs they created, giving a net employment change for all small firms of 95,000 between 1995 and 2000.
Table 3. Employment Creation and Reduction by Enterprise Size February 1995 to February 2000
| | Business Size |
|---|
| 0-5 | 6-19 | 20-99 | 100+ | All |
|---|
| Number of FTEs |
|---|
| Employment Creation |
| Continuing Business | 62,510 | 39,820 | 43,520 | 66,310 | 212,160 |
| New Business | 194,420 | 105,910 | 67,310 | 56,830 | 424,470 |
| Total | 256,930 | 145,730 | 110,830 | 123,140 | 636,630 |
| Employment Reduction |
| Ceased Business | -144,444 | -81,279 | -60,714 | -79,563 | -363,000 |
| Continuing Business | -20,424 | -26,685 | -29,805 | -78,234 | -155,148 |
| Total | -161,868 | -107,964 | -90,519 | -157,797 | -518,148 |
| No Change |
| Continuing Business | - | - | - | - | - |
| Net Employment Change | 95,062 | 37,766 | 20,311 | -34,657 | 118,482 |
The average size of New Zealand firms has dropped to below six
After a reduction in the average number of employees per enterprise over the last few years, it levelled out in 1999. The average number fell from seven workers per firm in 1994 to six workers in 1998. It remained steady at six workers in February 1999, however, in February 2000, the number fell again to below six.
Figure 4. Average FTEs per Enterprise
SMEs utilise the greatest proportion of part-time employees
Figure 5 shows utilisation of part-time employees decreases as firm size increases, ranging from 31.4 percent utilisation for firms employing 0-5 FTEs to 27.5 percent for firms employing 100+ FTEs. Over the decade to 2000, utilisation of part-time employees has increased across all size groups. This increase has been most apparent amongst larger firms, with 100+ FTE firms increasing utilisation from 9 percent in 1989 to the current level of nearly 28 percent.
Figure 5. Full/Part Time Employees by Enterprise Size
The majority of New Zealanders in the labour force are paid employees
Figure 6 illustrates data from the 2000 Household Labour Force Survey, showing the largest proportion (79 percent) of the employed New Zealand labour force are paid employees, while 20 percent are self-employed or an employer.
Figure 6. Employed Labour Force by Type of Employment 2000
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