Business demography: Employment and survival

This publication examines the effects of enterprise births and deaths on employment and the development of employment in the first five years after enterprise birth. Birth and death rates are usually substantially higher than the respective share of the observed enterprises in employment, because they are smaller on average than the whole population of active enterprises. Survival rates of newly born enterprises change insignificantly during the first five years. Results do not confirm the assumption that the likelihood to survive increases with the age of the enterprise in the first five years. Employment data for enterprises newly born in 2001 are examined more closely in nine Member States. In five of them the employment growth in enterprises surviving to 2006 compensated the job losses in enterprises that did not survive.