Births and Deaths
SMEs account for the majority of all births and deaths
As would be expected, enterprise births and deaths are dominated by firms employing less than 5 FTEs, accounting for over 90% of total number of births and deaths, both in 2000 and in previous years.
Given that new small businesses were the single greatest contributor to job creation over 1995 to 1997, a high rate of enterprise births amongst small firms should be encouraged. In addition, a high number of deaths is not in itself cause for concern as long as deaths of economically viable firms are minimised.
Figure 11. Enterprise Births 2000
Figure 12. Enterprise Deaths 2000
Enterprise births outnumbered deaths again in 2000
For the first time in the last decade the number of enterprise deaths outnumbered the number of enterprise births in 1999 on the back of an economic downturn both domestically and throughout the Asian region. This was common across firm sizes with all categories recording a net death rate. Despite this unusual phenomenon, the trend returned and the number of enterprise births overtook the number of enterprise deaths in 2000.
Figure 13. Enterprise Births and Deaths 1995-2000
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