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In 2021, the rate of enterprise births in the EU was 10.7% while the preliminary rate of enterprise deaths stood at 8.5%.

In most EU countries more companies were created than dissolved. The exceptions to this were Estonia, Lithuania, Bulgaria, Poland, Denmark and Germany where the number of enterprises dissolved surpassed the number of companies created.

This information comes from data published by Eurostat today. The article presents a handful of findings from the more detailed Statistics Explained article on structural business statistics.  

For the first time, Eurostat publishes detailed Business Demography Statistics (BD) compiled along the requirements of the new framework for European Business Statistics (EBS). Several improvements enhance the data’s capacity for analysis of the activity of enterprises in the EU, in particular for high-growth and young high-growth enterprises (also known as gazelles). The data now cover more economic activities, e.g. within services (education; human health and social work activities; arts, entertainment and recreation) and financial and insurance activities. Moreover, regional Business Demography Statistics are now available for all EU countries.

Bar chart: enterprise demography in the EU, 2021 (% of enterprises births and deaths among active enterprises)

Source dataset: bd_l_form

In 2021, the highest enterprise birth rates among EU countries were observed in Lithuania (20.2%), France (16.2%) and Malta and Portugal (both 14.4%). The lowest rates were registered in Estonia (3.1%), Austria (6.0%) and Greece (7.2%). The improved coverage of Business Demography Statistics shows the dynamic of the service economy, e.g. for ‘education’ or ‘arts, entertainment and recreation’ where, in both cases, birth rates were above 10% in two out of three EU countries (18).

The average employment size of newly born enterprises in 2021 varied between 0.4 persons in the Netherlands and 2.3 persons in Lithuania. At the EU level, the average size of newly born enterprises was 1.1 persons. 

As for enterprise preliminary death rates, the lowest rates among EU countries were registered in Greece (2.2%), Belgium (3.6%) and the Netherlands (4.2%). Estonia registered the highest death rate at 23.4%, followed by Lithuania with 22.6% and Bulgaria with 17.6%. 

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Methodological notes

  • Business demography are statistics about, amongst other things, the birth, survival (followed up to five years after birth) and death of enterprises within the business population. It reports changes in the stock of enterprises within the business economy from one year to the next, reflecting among other things the level of competition, entrepreneurial spirit and the business environment.
  • Enterprise 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 business population due to mergers, break-ups, split-offs or restructuring of a set of enterprises, nor do the statistics include entries into a sub-population that only result from a change of activity. The birth rate is the number of births relative to the stock of active enterprises.
  • Enterprise birth rate: number of enterprise births in the reference period divided by the number of enterprises active in that same period.
  • Enterprise death amounts to the dissolution of a combination of production factors, with the restriction that no other enterprises are involved in the event. An enterprise is only included in the count of deaths if it is not reactivated within two years. Equally, a reactivation within two years is not counted as a birth.
  • Enterprise death rate: number of enterprise deaths in the reference period divided by the number of enterprises active in that same period.
  • Generally, most enterprise births and deaths relate to enterprises that have no or only up to four employees.
  • Eurostat receives preliminary data on enterprise deaths at T+18 (i.e. 18 months after the end of the reference year) and final data on enterprise deaths at T+30 months.
  • Average employment size of newly born enterprises: average number of persons employed in the reference period (t) among enterprises newly born in t divided by the number of newly enterprises born in t. If an enterprise was created later in the year with one self-employed person, the rounded annual average might be less than 1.

 

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