1

The OECD/Eurostat Framework on Business Demography Indicators

Nadim Ahmad, Statistics Directorate, OECD

2

Background Eurostat database on BD indicators OECD study investigating comparability of

start-up rates OECD framework to improve comparability

in OECD countries (including new indictors)

OECD/Eurostat framework

3

Indicators Births and Deaths

– Thresholds- All enterprises - Employer enterprises (with turnover)- (Economic) Enterprises with 2+ employees (with

turnover)

Consistent treatment of ‘real’ births vis-a-vis reactivations, mergers, take-overs etc

4

Indicators Survival Rates

– 3 year survival and 5 year survival An enterprise born in year xx or having survived to

year xx from a previous year is considered to have survived in year xx+1 if it is active in terms of turnover and/or employment in any part of year xx+1 (= survival without changes).

Births and deaths follow the measures outlined earlier.

5

Indicators Employment in newly born enterprises

– Head counts on FTE basis during the period of activity. But, where not possible head counts are acceptable.

Impact of Deaths– Based on average employment during periods of activity in year of

death.

6

Indicators High Growth

– All enterprises with average annualised growth greater than 20% per annum, over a three year period, and with 10 or more employees in the beginning of the observation period, should be considered as high-growth enterprises: measured by the number of employees and by turnover.

Gazelles– All enterprises up to 5 years old with average annualised growth

greater than 20% per annum, over a three year period, and 10 or more employees in the beginning of the observation period, should be considered as gazelles.

7

High-Growth DevelopmentsComposite Indicators

– Paper develops hybrid Employment-Turnover based measure

t

nt

t

nt

Trn

Trn

Emp

Emp

t

nt

t

nt

PrL

PrL

Emp

Emp

8

High Growth Developments Previous indicators require some

convention: growth threshold, size-class cut-off to avoid small

firm bias.

What about Birch–type Indices to overcome size-class bias? combined with convention that we take the top X%

of enterprises in any country as high-growth.

0

1

01)(

t

ttt x

xxxm