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MEMO/11/661

Brussels, 4 October 2011

Small and medium sized enterprises: the situation in EU Member States 2010

The European Commission has just published Fact-Sheets on the situation concerning SMEs and regulations applying to them in all Member States. These form part of the SME Performance Review as a tool to monitor and assess Member States’ performance in implementing the Small Business Act (SBA) on the basis of a wide range of success indicators, focusing most notably on the measures in the SBA Action Plan. In the review of the SBA in February 2011 the Commission and the Member States acknowledged that strong governance is key to successful implementation of the SBA.

The 2010/2011 SBA Fact-Sheets draw on a set of 62 of statistical indicators and cover the 27 EU Member States, as well as Albania, Croatia, FYROM, Iceland, Israel, Liechtenstein, Norway, Montenegro, Serbia and Turkey. The indicators are grouped according to the ten dimensions of the Small Business Act, namely: Entrepreneurship, Second chance, Think Small First, Responsive Administration, State aid and Public procurement, Access to finance, Single market, Skills and innovations, Environment, and Internationalization.

The SBA Fact-Sheets have been prepared by the Directorate-General for Enterprise and Industry, assisted by the Joint Research Centre of the European Commission. The information concerning the recent policy measures adopted by the member states was compiled by a network of SME experts managed by Ecorys Netherlands and has been validated by Government representatives of the member states and the participating countries.

Country highlights from the SBA Fact Sheets:

Austria

  • Number of enterprises: SMEs in Austria represent 99,7% of the total enterprise stock and account for 61,4% of the economic added value and 67,1% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 1,7% of its workforce and its combined added value shrank by 0,2%.

  • For 2011, forecasts point towards a growth of 1,3% in the number of SMEs, 3,7% in gross value added and of 0,9% in employment.

  • SMEs in hotels & restaurants are much more important than in other countries

  • SBA performance is particularly strong in three areas: ‘Think Small First’, ‘State aid & public procurement’ and ‘Skills & innovation’

  • In 2010, Austria took action in all SBA areas

Belgium

  • Number of enterprises: SMEs in Belgium represent 99,8% of the total enterprise stock and account for 58,2% of the economic added value and 65,7% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 1,3% of its workforce and its combined added value shrank by 1,4%.

  • For 2011, forecasts point towards a growth of 1% in the number of SMEs, 3,9% in gross value added and of 0,8% in employment.

  • Trends: Belgium’s SME sector is expected to have recovered to pre-crisis levels by 2011 and trends are positive. The Belgian SME sector largely mirrors the EU average, in terms of both its structure and its sectoral breakdown.

  • SBA performance: Belgium is situated around, or above, the EU average in all SBA areas, except ‘Entrepreneurship’.

  • SBA action: Recently, policy measures have been taken in all ten SBA areas. Particularly intensive efforts have been made to address ‘Entrepreneurship’, the area in which Belgium is falling behind.

Bulgaria

  • Number of enterprises: SMEs in Bulgaria represent 99,7% of the total enterprise stock and account for 59,2% of the economic added value and 73,5% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 4,3% of its workforce yet its combined added value still grew by 18,1%.

  • For 2011, forecasts point towards a growth of 3,2% in the number of SMEs, 8,1% in gross value added and of 1,7% in employment.

  • Trends: The development of Bulgaria’s SME sector was temporarily dampened by the crisis but economic trends are positive. Bulgaria’s SME sector is similar to the EU average, but its role in providing jobs and contributing to value added is even more important in Bulgaria.

  • SBA performance: Overall Bulgaria is, around or below the EU average across most SBA areas. But with time there seems to be progress in most SBA areas.

  • SBA action: Bulgaria has recently targeted eight out of ten SBA areas with dedicated policy measures.

Cyprus

  • Number of enterprises: SMEs in Cyprus represent 99,8% of the total enterprise stock and account for 75% of the economic added value and 83,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 3,3% of its workforce and its combined added value shrank by 5,9%.

  • For 2011, forecasts point towards a decrease of 0,7% in the number of SMEs, but an increase of 3,5% in gross value added and of 1,8% in employment.

  • Specific SME features: Its SMEs are surprisingly large (4.6 employees per firm), given the small domestic market.

  • Trends: In employment and value-added terms, SMEs are expected to gradually recover to pre-crisis levels during 2011. The number of SMEs is, however, expected to stagnate

  • SBA performance: Cyprus’ SBA profile is particularly strong in ‘Entrepreneurship’, Public procurement & State aid’ and ‘Skills & innovation’

  • SBA action: Action has been taken in all SBA areas except ‘Second Chance’, ‘Public Procurement and State Aid’ and ‘Environment’.

Czech Republic

  • Number of enterprises: SMEs in Czech Republic represent 99,8% of the total enterprise stock and account for 55,7% of the economic added value and 67,7% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost almost 4% of its workforce and its combined added value shrank by 1,5%.

  • For 2011, forecasts point towards a growth of 1,5% in the number of SMEs, 2,7% in gross value added while employment stabilised at the 2010 level.

  • Specific SME features: Czech SMEs are much more concentrated in manufacturing (almost 1/3 of total SME employment versus only 22 % in the EU as a whole).

  • Trends: Employment in SMEs has declined since 2003 by some 116 000.

  • SBA performance: ‘Catching-up’ SBA profile lags behind the EU average in many areas, but 7 out of 9 areas show progress since 2005.

  • SBA action: In 201011, the Czech Republic took major policy action in all ten SBA areas.

Denmark

  • Number of enterprises: SMEs in Denmark represent 99,7% of the total enterprise stock and account for 66,5% of the economic added value and 66,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 5,5% of its workforce while its combined added value shrank by 7,9%.

  • For 2011, forecasts point towards a growth of 1% in the number of SMEs, 3,4% in gross value added and of 0,7% in employment.

  • Trends: Denmark scores above the EU average on all SBA principles except Entrepreneurship. However, the indicators have stayed stagnant.

  • SBA performance: In 2010/2011, Denmark addressed nine out of the ten SBA areas through targeted policy measures, focusing on stimulating entrepreneurship, improving access to finance and facilitating innovation.

Estonia

  • Number of enterprises: SMEs in Estonia represent 99,7% of the total enterprise stock and account for 76,2% of the economic added value and 77,8% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 15,2% of its workforce the construction sector being principally affected. Its combined added value shrank by 19,9%.

  • For 2011, forecasts point towards a growth of 4,1% in the number of SMEs, 6,3% in gross value added and of 1,1% in employment.

  • Trends: Estonia is scoring above or on par with the EU average in a majority of SBA principles. However, the development over time is somewhat stagnant.

  • SBA performance: In 2010/2011, Estonia has addressed six out of ten SBA areas through targeted policy measures, focusing in particular on promoting entrepreneurship and internationalisation.

Finland

  • Number of enterprises: SMEs in Finland represent 99,7% of the total enterprise stock and account for 54,9% of the economic added value and 60,6% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 3,5% of its workforce but its combined added value still grew by 8,5%.

  • For 2011, forecasts point towards a growth of 1,5% in the number of SMEs, 7,7% in gross value added and of 1,1% in employment.

  • Specific SME features: The Finnish small businesses sector is similar in structure to that of other EU Member States

  • Trends: It is growing rapidly: in 2002–2008 the net number of micro-firms increased by 20 % (or 34 000)

  • SBA performance: Finland has the best SBA profile of all EU Member States: it outperforms the EU average in 8 out of 9 SBA areas

  • SBA Action: Progress in most areas has been stagnating, but at a much higher level than in the other Member States

France

  • Number of enterprises: SMEs in France represent 99,8% of the total enterprise stock and account for 56% of the economic added value and 60,4% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 4,5% of its workforce and its combined added value shrank by 2,5%.

  • For 2011, forecasts point towards a growth of 2,1% in the number of SMEs, 3,4% in gross value added and of 0,4% in employment.

  • SBA performance: France scores above or on par with the EU average for most SBA principles. However, indicators have stayed somewhat stagnant over the past years.

  • SBA Action: In 2010/2011, France addressed six out of ten SBA areas through targeted policy measures, focusing on facilitating access to finance and responsive administration.

Germany

  • Number of enterprises: SMEs in Germany represent 99,5% of the total enterprise stock and account for 53,8% of the economic added value and 60,9% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have increased its workforce by 0,4% while its combined added value shrank by 0,6%.

  • For 2011, forecasts point towards a growth of 1,1% in the number of SMEs, 4,8% in gross value added and of 1,2% in employment.

  • Trends: The German SME sector is recovering well from the crisis.

  • Specific SME features: Germany’s medium-sized businesses play an important role and created 500 000 new jobs between 2002-2008.

  • SBA performance: In 4 SBA areas, Germany does better than the EU average and performed particularly strongly in ‘Skills and Innovation’ and ‘Internationalisation’.

  • SBA Action: In 2010-2011, Germany took action in all SBA areas except ‘Environment’.

Greece

  • Number of enterprises: SMEs in Greece represent 99,9% of the total enterprise stock and account for 71,7% of the economic added value and 85,6% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 5% of its workforce and its combined added value shrank by 3,8%.

  • For 2011, forecasts point towards a continuing decrease of 3,3% in the number of SMEs, 3,9% in gross value added and of 2,8% in employment.

  • Trends: Greek SME has sector suffered from the crisis with particularly lasting adverse effects on the number and value added of SMEs.

  • Specific SME features: The Greek economy is based more heavily on micro firms than other EU economies and this segment also accounts for more than half of all jobs.

  • SBA performance: Overall, Greece ranks below the EU average for most SBA areas. In addition, progress has been stagnant or even negative, with improvements recorded only in a few SBA areas.

  • SBA Action: Recently, Greece has addressed six out of ten SBA areas through targeted policy measures.

Hungary

  • Number of enterprises: SMEs in Hungary represent 99,9% of the total enterprise stock and account for 54,6% of the economic added value and 71,7% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 0,3% of its workforce and its combined added value shrank by 9,5%.

  • For 2011, forecasts point towards a growth of 1,1% in the number of SMEs, 3% in gross value added and of 1,5% in employment.

  • Specific SME features: Hungary is more dependent on micro firms than other EU Member States

  • Trends: SMEs are recovering from the crisis in employment and value-added terms, but the number of SMEs has stagnated since 2005

  • SBA performance: Its SBA profile shows Hungary is catching up: statistics show that most SBA areas trail the EU average, but they are improving

  • SBA Action: In 2010, Hungary took action in all SBA areas, except ‘Entrepreneurship’ and ‘Single Market’.

Ireland

  • Number of enterprises: SMEs in Ireland represent 99,5% of the total enterprise stock and account for 47,9% of the economic added value and 66,8% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 14,9% of its workforce and its combined added value shrank by 18,2%.

  • For 2011, forecasts point towards a continuing decline of 2,4% in the number of SMEs, 0,6% in gross value added and of 2,1% in employment.

  • SBA performance: Ireland scores above or on par with the EU average for most SBA principles. However, progress is rather stagnant.

  • SBA Action: In 2010/2011, Ireland addressed six out of ten SBA areas through targeted policy measures, focusing on facilitating access to finance and reducing administrative burden.

Italy

  • Number of enterprises: SMEs in Italy represent 99,9% of the total enterprise stock and account for 71,3% of the economic added value and 81,4% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 3,3% of its workforce and its combined added value shrank by 4%.

  • For 2011, forecasts point towards a decline of 0,6% in the number of SMEs but of 2,9% in gross value added and a stagnation in employment. Italy’s SME sector is expected to recover to pre-crisis levels only after 2011.

  • Specific SME features: Italy is more dependent on micro firms than other EU members, but medium-sized enterprises have grown the fastest since 2003.

  • SBA performance: There is still some catching up to do in almost all SBA areas to reach EU average performance.

  • SBA Action: In 2010, Italy adopted a strategy to speed up SBA take-up.

Latvia

  • Number of enterprises: SMEs in Latvia represent 99,7% of the total enterprise stock and account for 70% of the economic added value and 77,8% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 18,3% of its workforce and its combined added value shrank by 29,3%.

  • For 2011, forecasts point towards a growth of 5,9% in the number of SMEs, 2,3% in gross value added and of 2,9% in employment.

  • Specific SME features: Latvian SMEs are on average larger than their EU peers, with 6.4 employees/enterprise compared to 4.2 on average in the EU.

  • Trends: Latvia’s SBA profile is varied, with an overall situation close to the EU average. But its development over time has been quite dynamic.

  • SBA performance: Recently, Latvia has targeted eight out of ten SBA areas with dedicated policy measures.

Lithuania

  • Number of enterprises: SMEs in Lithuania represent 99,8% of the total enterprise stock and account for 64,1% of the economic added value and 75,9% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 10,9% of its workforce and its combined added value shrank by 24,6%.

  • For 2011, forecasts point towards a growth of 16,8% in the number of SMEs, 5,8% in gross value added and of 0,6% in employment.

  • SBA performance: Lithuania scores on a par with the EU average in a majority of SBA principles. But there has been progress in most areas

  • SBA Action: In 2010–2011, Lithuania addressed eight out of ten SBA areas with targeted policy measures, focusing on stimulating entrepreneurship, facilitating access to finance and responsive administration.

Luxembourg

  • Number of enterprises: SMEs in Luxembourg represent 99,6% of the total enterprise stock and account for 69,8% of the economic added value and 66,7% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have experienced a modest growth of 0,7% of its workforce and of 0,6% of its combined added value.

  • For 2011, forecasts point towards a growth of 1,6% in the number of SMEs, 6,3% in gross value added and of 0,7% in employment.

  • Specific SME features: The SME sector is expanding rapidly with a 23% net increase in the number of SMEs (between 2003-2010) and 25 000 new jobs

  • Trends: Having been spared from damaging effects of the crisis, growth is set to increase well into the future (even beyond 2012)

  • SBA performance: Luxembourg’s SBA profile in almost all areas is equivalent to the EU average

  • SBA Action: Major steps have been taken in all SBA areas except for ‘Second Chance’, ‘Access to Finance’ and ‘Skills and Innovation’

Malta

  • Number of enterprises: SMEs in Malta represent 99,9% of the total enterprise stock and account for 73,4% of the economic added value and 77,4% of employment in the private sector.

  • For 2011, forecasts point towards a growth of 3,7% in gross value added and of 2,5% in employment.

  • Specific SME features: Micro-firms play a more dominant role than elsewhere

  • Trends: Employment in SMEs has not improved since 2005

  • SBA performance: In 2 out of 5 SBA areas, Malta is below the EU average

  • SBA Action: In 2010, important new policy action was taken in all SBA areas, except ‘Second Chance’

Netherlands

  • Number of enterprises: SMEs in Netherlands represent 99,7% of the total enterprise stock and account for 62% of the economic added value and 68,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have increased its workforce by 3,8% and its combined added value by 9,8%.

  • For 2011, forecasts point towards a growth of 1,3% in the number of SMEs, 4,2% in gross value added and of 0,9% in employment.

  • Trends: Between 2003-2008, Dutch SMEs created almost 450 000 new jobs, a rise of 2.4 % p.a. (EU average: 1.7%).

  • SBA performance particularly strong in three areas: ‘Second Chance , ‘Think small first’ and ‘Internationalisation’

  • SBA Action: In 2010, the Netherlands initiated major new policy actions in seven out of 10 SBA areas

Poland

  • Number of enterprises: SMEs in Poland represent 99,8% of the total enterprise stock and account for 54% of the economic added value and 67,5% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost only 0,2% of its workforce and its combined added value shrank by 2,1%.

  • For 2011, forecasts point towards a growth of 0,9% in the number of SMEs, 9,8% in gross value added and of 1% in employment.

  • SBA performance: Poland scores below average on most SBA principles. However, the development over time suggests the country is quickly catching up.

  • SBA Action: In 2010–2011, Poland has addressed seven out of ten SBA areas through targeted policy measures, focusing on facilitating access to finance and improving the entrepreneurial environment.

Portugal

  • Number of enterprises: SMEs in Portugal represent 99,9% of the total enterprise stock and account for 67,2% of the economic added value and 80,9% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 2,3% of its workforce and its combined added value shrank by 2,1%.

  • For 2011, forecasts point towards a decline of 1,4% in gross value added and of 0,8% in employment in the SME sector.

  • Trends: Portugal trails the EU average in a third of the SBA areas but is caching up fast in most.

  • SBA performance: In 2010-2011, Portugal took action in all SBA areas except ‘Second Chance’ and ‘Public Procurement and State Aid.’

Romania

  • Number of enterprises: SMEs in Romania represent 99,7% of the total enterprise stock and account for 45,7% of the economic added value and 68,1% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have increased its workforce by 0,7% while its combined added value shrank by 3,8%.

  • For 2011, forecasts point towards a growth of 2,3% in the number of SMEs, 7,1% in gross value added and of only 1% in employment.

  • SBA performance: Romania scores below or on par with the EU average for most SBA principles, but six of these areas show progress over time.

  • SBA Action: In 2010/2011, Romania addressed seven out of ten SBA areas through targeted policy measures, the main focus being entrepreneurship and access to finance.

Slovakia

  • Number of enterprises: SMEs in Slovakia represent 99,2% of the total enterprise stock and account for 52% of the economic added value and 57,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 12,2% of its workforce and its combined added value shrank by 1,8%.

  • For 2011, forecasts point towards a growth of 9,3% in the number of SMEs, 7,3% in gross value added and of 3,1% in employment.

  • SBA performance: Slovakia scores above or on par with the EU average for three SBA principles, while the rest are below.

  • SBA Action: In 2010/2011, Slovakia addressed seven out of the ten SBA areas through targeted policy measures, focusing on think small first and responsive administration.

Slovenia

  • Number of enterprises: SMEs in Slovenia represent 99,8% of the total enterprise stock and account for 63,2% of the economic added value and 64,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 0,5% of its workforce and its combined added value shrank by 7,3%.

  • For 2011, forecasts point towards a growth of 0,1% in the number of SMEs and 2,9% in gross value added but a loss of 1,5% in employment.

  • SBA performance: Slovenia scores above or on par with the EU average in most SBA areas. However, recent progress is patchy, with some improvements and some deterioration.

  • SBA Action: In 2010/2011, Slovenia addressed all but one of the ten SBA areas through targeted policy measures, focusing on facilitating access to finance, implementing the Think Small First principle and improving the entrepreneurial education.

Spain

  • Number of enterprises: SMEs in Spain represent 99,9% of the total enterprise stock and account for 67,9% of the economic added value and 76,3% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 14,1% of its workforce and its combined added value shrank by 5,2%.

  • For 2011, forecasts point towards a continuing reduction of 0,4% in the number of SMEs, and of 0,6% in employment, but also a moderate growth of 0,9% in gross value added.

  • SBA performance: Spain scores at or above the EU average in only three of the SBA principles, but most of the other areas are catching up

  • SBA Action: In 2010/2011, Spain has addressed seven out of ten SBA areas by means of targeted policy measures, focusing in particular on facilitating access to finance and reducing administrative burden

Sweden

  • Number of enterprises: SMEs in Sweden represent 99,8% of the total enterprise stock and account for 56,8% of the economic added value and 64,2% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 1% of its workforce but its combined added value increased by 2,3%.

  • For 2011, forecasts point towards a growth of 5,8% in gross value added and of 1,9% in employment in the SME sector.

  • Trends: The Swedish SME sector seems to be recovering from the crisis.

  • Specific SME features: Sweden’s micro-firm segment is more dominant than in the EU as a whole, but it is not quite as important in terms of jobs and value added creation

  • SBA performance: Sweden is above the EU average in all but one SBA areas for which data is available. Nevertheless, in recent times Sweden’s performance has not been very dynamic.

  • SBA Action: In 2010 and the first quarter of 2011, Sweden has taken targeted policy action in seven out of ten SBA areas.

United Kingdom

  • Number of enterprises: SMEs in United Kingdom represent 99,6% of the total enterprise stock and account for 50,2% of the economic added value and 53,9% of employment in the private sector.

  • From 2008 to 2010, the SME sector is estimated to have lost 2% of its workforce while its combined added value shrank by 10,8%.

  • For 2011, forecasts point towards a growth of 0,2% in the number of SMEs, 6% in gross value added and an unchanged employment level.

  • Trends: The UK’s SME sector is expected to recover to pre-crisis levels only after 2011. Value-added creation in particular will need more time to recover.

  • Specific SME features: The United Kingdom’s economy is much less based on micro firms than other EU economies and, correspondingly, large enterprises play a more prominent role.

  • SBA performance: Overall, the United Kingdom ranks above the EU average across six SBA areas. However, progress has not been very dynamic lately, with only minor improvements recorded.

  • SBA Action: Recently, the United Kingdom has addressed seven out of ten SBA areas through targeted policy measures, focusing on facilitating access to finance

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