Businesses in financial and insurance activities sector

Data extracted in June 2024

Planned article update: June 2025

Highlights

In 2021, businesses in the financial and insurance activities sector generated €1 trillion of value added, which accounted for 11 % of the EU’s value added.

There were 4.9 million persons employed in businesses in the financial and insurance activities sector in 2021.

This article presents an overview of statistics for the European Union's (EU) Financial and insurance activities sector, as covered by NACE Rev. 2 Section K. It belongs to a set of statistical articles on 'Business economy by sector'. Following the entry into force of the European Business Statistics (EBS) Regulation, Eurostat has extended the service coverage for structural business statistics (SBS) data and is publishing, for the first time, SBS data on the financial and insurance activities sector.

Full article

Structural profile

In 2021, the EU's financial and insurance activities sector (Section K) comprised a total of over 759 000 enterprises, which represented 2.5 % of all enterprises active in the business economy (Sections B to N and P to R, as well as Divisions S95 and S96). These enterprises employed 4.9 million persons and accumulated a net turnover of €2.3 trillion. In 2021, the financial and insurance activities sector generated over €1.0 trillion in value added, accounting for 11 % of the EU’s business economy value added.

SBS data only cover the activities of market producers. It should be noted that the data in this article only cover the market producers, meaning those acting under market conditions, active in this sector.

Table 1: Key indicators, Financial and insurance activities (NACE Section K), EU, 2021
Source: Eurostat (sbs_ovw_act)

In 2021, the EU's financial and insurance activities sector recorded the highest apparent labour productivity and average employee benefits expense among all the NACE sections within the business economy. The apparent labour productivity in the financial and insurance activities sector stood at €209 700 per person employed, representing a noteworthy difference of €149 500 compared with the business economy average of €60 200 per person employed. Similarly, the average employee benefits expense within the financial and insurance activities sector amounted to €74 100 per employee, indicating a difference of €35 200 from the business economy average of €39 000 per employee.

Combining these two ratios into the wage-adjusted labour productivity ratio shows the extent to which value added per person employed covers average personnel costs per employee. In 2021, the financial and insurance activities sector demonstrated a wage-adjusted labor productivity ratio of 282.9 %, reflecting the sector's high productivity. This was the second highest ratio across all NACE sections within the business economy, being marginally lower than electricity, gas, steam and air conditioning supply (NACE Section D). The gross operating rate stood at 30.8 % for the EU's financial and insurance activities sector in 2021. This figure surpassed the 13.2 % average of gross operating rate for the business economy, ranking second among the NACE sections, after the real estate activities (NACE section L). The gross operating rate indicates the share of turnover remaining after paying for purchased goods and services as well as employee benefits expense (in other words, the gross operating surplus).

Sectoral analysis

The financial and insurance activities sector is organized into three NACE divisions at 2-digit level:

financial service activities, except insurance and pension funding (Division 64),
insurance, reinsurance and pension funding, except compulsory social security (Division 65),
activities auxiliary to financial services and insurance activities (Division 66).

As mentioned in the introduction, SBS cover only the market producers in the financial and insurance activities sector, i.e. those acting under market conditions.
In 2021, more than half of the EU's employment in the financial and insurance activities sector were allocated to the subsector of financial service activities, except insurance and pension funding (Division 64), which encompasses activities of obtaining and redistributing funds other than for the purpose of insurance or pension funding or compulsory social security. It includes, among others, monetary intermediation done by banks and central banks, activities of holding companies, as well as trusts, funds and similar financial entities — see Figure 1. This subsector recorded also the highest value added.

Figure 1: Sectoral analysis of Financial and insurance activities (NACE Section K), EU, 2021
(% share of sectoral total)
Source: Eurostat (sbs_ovw_act)

In 2021, division 64 comprised of 281 200 enterprises and a workforce of 2.7 million persons, contributing to the EU's business economy with a value added of €496.5 billion and a net turnover of €771.6 billion. The highest turnover (€1.2 trilion) was recorded by the subsector of insurance, reinsurance and pension funding, except compulsory social security (Division 65), which includes life insurance and non-life insurance, reinsurance and pension funding. This high turnover was generated by a very small number of companies, only 7 300, characterized as large enterprises. In 2021, they employed 744 000 persons and generated €388 billion in value added. The highest number of enterprises, yet mostly of a smaller scale, was recorded in the subsector of activities auxiliary to financial services and insurance activities (Division 66). This division includes the provision of services involved in or closely related to financial service activities, but not themselves providing financial services, like stock exchanges and management of mutual or pension funds. This subsector employed 1.5 million persons, as seen in Table 2.

Table 2: Sectoral analysis of key indicators, Financial and insurance activities (NACE Section K), EU, 2021
Source: Eurostat (sbs_ovw_act)

Country overview

Figure 2 illustrates the diverse landscape of the market activities in the financial and insurance activities sector's contribution to the business economy's value added. In 2021, this has varied from 5.2 % in Lithuania, 5.7 % in Poland and 5.9 % in Latvia to 18.9 % in Sweden, 31.5 % in the Netherlands and has reached the highest share at 34.0 % in Luxembourg. The share in employment terms was much lower, varying from 1.8 % in Lithuania to 12.1 % in Luxembourg. The EU averages stood in 2021 at 10.9 % for value added and 3.1 % for employment.

Figure 2: Relative importance of Financial and insurance activities (NACE Section K; only market activities), EU, 2021
(% share of value added and employment in the business economy total)
Source: Eurostat (sbs_ovw_act)

Among the five largest EU countries, the Netherlands accounted for 24.9 % of the EU valued added of market activities in the financial and insurance activities sector in 2021, high above its 8.7 % share of value added in the EU's business economy as a whole. Germany recorded the second-highest share, accounting for 20.5 % of the value added in the EU's financial and insurance activities sector. France, Sweden and Spain completed the top 5 with 13.5 %, 6.8 % and 4.8 % respectively. The contribution of the top 5 countries in the financial and insurance activities sector accounted for 70.6 % of the value added and 66.9 % of employment. In terms of employment, the financial and insurance activities sector (only market activities) in Germany had the highest share in the whole business economy (23.6 %), being followed by France, Italy, Spain and Poland— see Figure 3.

Figure 3: Concentration of value added and employment, Financial and insurance activities (NACE Section K), EU, 2021
(cumulative share of the five principal EU Member States as a % of the EU total)
Source: Eurostat (sbs_ovw_act)

Table 3: Largest and most specialised Member States in Financial and insurance activities (NACE Section K), EU, 2021
Source: Eurostat (sbs_ovw_act)

In value added terms, Germany was the largest EU country in two of the three financial and insurance activities subsectors in 2021 (see Table 3): financial service activities, except insurance and pension funding (Division 64) and activities auxiliary to financial services and insurance activities (Division 66), while Luxembourg was the most specialized country in both subsectors. In division 65 (insurance, reinsurance and pension funding, except compulsory social security), the Netherlands was the most specialized EU country and had the highest share, 22.4 % of the EU value added. As seen in Table 4, in absolute terms, the Netherlands generated €256.4 billion, Germany €211.1 billion and France €184.5 billion. In terms of turnover, Germany accumulated in 2021 the highest value (€654.0 billion) within the financial and insurance activities sector. The second and third highest values were recorded in France (€511.6 billion) and Italy (€138.4 billion). The same three countries also dominated the employment, Germany recording the highest number of persons employed within the financial and insurance activities sector in 2021, almost 1.2 million persons.

Table 4: Key indicators, Financial and insurance activities (NACE Section K), EU, 2021
Source: Eurostat (sbs_ovw_act)

Size class analysis

Large enterprises (employing 250 or more persons) contributed more to the EU's financial and insurance activities sector than is typical for the business economy as a whole. In 2021, some 55.5 % of the manufacturing sector's value added was generated by large enterprises (€570.2 billion) and these employed 64.6 % of the employment (3.2 million persons employed); for comparison, the business economy average for large enterprise was a 47.5 % share of value added and a 35.6 % share of the employment. In terms of number of enterprises, micro enterprises (employing fewer than 10 persons) have dominated EU's financial and insurance activities sector. They have accounted for 97.0 % of the total enterprise population within the financial and insurance activities sector in 2021. They provided work to 897 000 persons, which equated to 18.3 % of the employment within the financial and insurance activities sector and generated a value added of €137.0 billion, representing only 13.3 % of the sector’s value added.

Table 5: Key size class indicators, Financial and insurance activities (NACE Section K), EU, 2021 - Source: Eurostat (sbs_sc_ovw)

Among the four size classes, large enterprises dominated in terms of employment in two of the three subsectors within the financial and insurance activities sector: insurance, reinsurance and pension funding, except compulsory social security (Division 65) with 86.8 % and financial service activities, except insurance and pension funding (Division 64) with 77.8 %. The third subsector, activities auxiliary to financial services and insurance activities (Division 66) had a higher share of micro enterprises (employing less than 10 persons) among the four size classes – see Figure 4.

Figure 4: Sectoral analysis of employment by enterprise size class, Financial and insurance activities (NACE Section K), EU, 2021
(% share of sectoral employment) - Source: Eurostat (sbs_sc_ovw)

Large enterprises generated around three quarters of the value added in the subsector of financial service activities, except insurance and pension funding (Division 64). While in insurance, reinsurance and pension funding, except compulsory social security (Division 65), large enterprises contributed 42 % to the value added. This was closely followed by medium-sized enterprises (employing from 50 to 249 persons) with a share of 34.5 %. Division 66, activities auxiliary to financial services and insurance activities had a similar distribution of the shares of the four size classes in terms of value added as in terms of employment.

Figure 5: Sectoral analysis of value added by enterprise size class, Financial and insurance activities (NACE Section K), EU, 2021
(% share of sectoral value added) - Source: Eurostat (sbs_sc_ovw)

In employment terms, the relative weight of large enterprises in 2021 was above the EU average (64.6 %) in only Germany, Denmark, Slovenia, Spain, Croatia and France. Small enterprises (employing from 10 to 49 persons) had the smallest share among the four size classes in most EU countries both in terms of employment and in terms of value added.

Table 6a: Number of persons employed by enterprise size class, Financial and insurance activities (NACE Section K), EU, 2021 - Source: Eurostat (sbs_sc_ovw)

In 2021, large enterprises in the financial and insurance activities sector generated more than two thirds of value added in 11 of the EU countries for which data are available. The share of value added stemming from medium-sized enterprises exceeded one third of the total only in the Netherlands (44.2 %), while from micro enterprises in Bulgaria (34.0 %), Malta (39.9) % and Croatia (56.7 %). Small and medium enterprises (SMEs) generated over half of the value added in Czechia, Sweden, Ireland, Finland, Bulgaria, Luxembourg, Croatia, Cyprus and reached the highest share in Malta and the Netherlands (74.8 % each). At EU level, the SMEs generated €457.3 billion of value added, representing 44.5 % of the value added of the EU’s financial and insurance activities sector.

Table 6b: Value added by enterprise size class, Financial and insurance activities (NACE Section K), EU, 2021 - Source: Eurostat (sbs_sc_ovw)

Data sources and availability

Coverage

The financial and insurance activities sector includes financial service activities, including insurance, reinsurance and pension funding activities and activities to support financial services. It covers, as well, the activities of holding assets, such as activities of holding companies and the activities of trusts, funds and similar financial entities.
The activities covered by the financial and insurance activities sector are categorized as follows:

financial service activities, except insurance and pension funding (Division 64)
- monetary intermediation (Division 641)
- activities of holding companies (Division 642)
- trusts, funds and similar financial entities (Division 643)
- Other financial service activities, except insurance and pension funding (Division 649)

This division encompasses activities of obtaining and redistributing funds other than for the purpose of insurance or pension funding or compulsory social security. It includes, among others, monetary intermediation done by banks and central banks, activities of holding companies, as well as trusts, funds and similar financial entities

insurance, reinsurance and pension funding, except compulsory social security (Division 65)
- insurance (Division 651)
- reinsurance (Division 652)
- pension funding (Division 653)

This division includes the underwriting annuities and insurance policies and investing premiums to build up a portfolio of financial assets to be used against future claims. Provision of direct insurance and reinsurance are included.

activities auxiliary to financial services and insurance activities (Division 66)
- activities auxiliary to financial services, except insurance and pension funding (Division 661)
- activities auxiliary to insurance and pension funding (Division 662)
- fund management activities (Division 663)

This division includes the provision of services involved in or closely related to financial service activities, but not themselves providing financial services, like stock exchanges and management of mutual or pension funds. The primary breakdown of this division is according to the type of financial transaction or funding served.

Data sources

Structural business statistics cover the 'business economy', which includes industry, construction and many services (NACE Rev. 2 sections B to N, P to R as well as division S95 and S96). Structural business statistics do not cover agriculture, forestry and fishing, nor public administration.
Structural business statistics describe the business economy through the observation of units engaged in an economic activity; the unit in structural business statistics is generally the enterprise. An enterprise carries out one or more activities, at one or more locations, and it may comprise one or more legal units. Enterprises that are active in more than one economic activity (plus the value added and turnover they generate, the people they employ, and so on) are classified under the NACE heading corresponding to their principal activity; this is normally the one which generates the largest amount of value added.
The analysis presented in this article is based on the main dataset for structural business statistics (SBS), size class data and regional data, all of which are published annually. SBS only cover the activities of market producers, meaning those acting under market conditions. Contrary to most activities covered by SBS, non-market producers represent a significant part of the Financial and insurance activities sector.

The main series provides information for each EU countries as well as a number of non-EU countries at a detailed level according to the activity classification NACE. Data are available for a wide range of variables.
In structural business statistics, size classes are generally defined by the number of persons employed. A limited set of the standard structural business statistics variables (for example, the number of enterprises, turnover, persons employed and value added) are analysed by size class, mostly down to the three-digit (group) level of NACE. The main size classes used in this article for presenting the results are:

small and medium-sized enterprises (SMEs): with 1 to 249 persons employed, further divided into
- micro enterprises: with less than 10 persons employed;
- small enterprises: with 10 to 49 persons employed;
- medium-sized enterprises: with 50 to 249 persons employed;
large enterprises: with 250 or more persons employed.

Structural business statistics also include regional data. Regional SBS data are available at NUTS levels 1 and 2 for most of the EU countries, Iceland and Norway, mostly down to the two-digit (division) level of NACE. The main variable analysed in this article is the number of persons employed. The type of statistical unit used for regional SBS data is normally the local unit, which is an enterprise or part of an enterprise situated in a geographically identified place. Local units are classified into sectors (by NACE) normally according to their own main activity, but in some EU countries the activity code is assigned on the basis of the principal activity of the enterprise to which the local unit belongs. The main SBS data series are presented at national level only, and for this national data the statistical unit is the enterprise. It is possible for the principal activity of a local unit to differ from that of the enterprise to which it belongs. Hence, national SBS data from the main series are not necessarily directly comparable with national aggregates compiled from regional SBS.

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