There has been demand for statistical and monitoring data focusing on micro-enterprises. A micro-enterprise is defined as a company with fewer than ten employees and turnover of less than 2 million. Of the 343 909 companies operating in Finland, 319 815, or 93%, are micro-enterprises. The University of Oulu Kerttu Saalasti Institute publishes an annual statistical report focusing on micro-enterprises; Statistics on micro-enterprises. The aim is to provide comprehensive up-to-date statistics on the state, development picture and impact of micro-enterprises on the vitality of regions.
Statistics on micro-enterprises has been updated with the latest statistics on the economy, employment and exports from 2021. Compared to previous reports, new information has been produced especially on the strongly increased number of micro-enterprises by municipality. In addition, new municipality-specific data on goods exports by micro-enterprises and, in aggregate, micro and small enterprises, as well as EU service exports are provided in connection with exports.
The number of all companies and micro-enterprises increased between 2020 and 2021. However, among micro enterprises, the number of enterprises employing less than half a person-year increased. The observation reflects a larger trend in which entrepreneurship is increasingly carried out alongside paid employment, studies or pension, for example, as part of a diversifying working life. At the same time, the number of micro-enterprises larger than part-time entrepreneurs decreased, which is a worrying signal for future growth potential.
In 2021, the number of enterprises that started operations in the whole country increased to a higher level than in the previous years of comparison. The number of enterprises that had ceased operations in 2020 remained unchanged compared to the previous year. The net change in the number of enterprises between 2016 and 2020 was greatest in the Helsinki Metropolitan Area, the regions of Turku, Tampere and Oulu, as well as in Jyväskylä, Kuopio and Rovaniemi. The number of enterprises also increased in some rural municipalities, such as Sotkamo, Ylivieska, Sievi, Reisjärvi, Luoto, Pietarsaari, Pedersöre and the Province of Åland.
The turnover of micro-enterprises grew by six per cent between 2018 and 2021, which is one percentage point higher than in the comparison period in the previous year. However, in the latest annual period 2020 to 2021, the turnover per capita of micro-enterprises in the whole country decreased by about one percentage point. At the same time, the combined turnover per capita of companies of all sizes increased by almost 10 per cent.
Micro-enterprises' turnover grew most in the fields of electricity, gas, heating and cooling, and scientific research and development. Turnover fell the most in the activities of travel agencies, tour operators and booking services as well as in gambling and betting services. Compared to the population, the turnover of micro-enterprises was highest in the Åland Islands, the Suupohja coastal region, Loimaa and Tornionlaakso sub-regions.
In Finland, 22% of jobs in all companies are in micro-enterprises. Both the number of jobs in all companies as well as in micro-enterprises in relation to the workforce decreased throughout the country between 2020 and 2021. The decline is due to an increase in the labour force, but there are also regional differences. The drop was greatest in the main industries of agriculture, forestry and fisheries as well as wholesale and retail trade.
More than half of micro-enterprises employ less than half a person-year. During 2018–2021, the number of jobs in micro-enterprises started to decline. During the most recent review period (2020–2021), the number of person-years worked in micro-enterprises decreased by 15% (from 352,162 person-years to 299,126 person-years). In the longer term, self-employment in general has increased popularity. The total number of micro-enterprises and the creation of new enterprises play a decisive role in society in the change in the employment impact of micro-enterprises.
Work in large micro-enterprise sectors decreased significantly between 2020 and 2021: the number of person-years decreased by 15% in wholesale and retail micro-enterprises and by up to 30% in micro-enterprises in agriculture, forestry and fisheries. The significant decrease may be partly explained by entrepreneurs who reduced the number of employees, closed down their operations or moved elsewhere to salaried employment during the COVID pandemic, as well as by the decrease in jobs in the agricultural sector.
Between 2020 and 2021, the number of jobs in both micro-enterprises and all companies in relation to the workforce decreased throughout the country. The decline is due to an increase in the labour force, but there are also regional differences. Looking at the main sectors, the greatest drops are found in the main sectors of agriculture, forestry, fisheries, wholesale and retail trade.
Although the overall trend in the number of people is decreasing, there are also strongly growing companies among micro-enterprises. Based on the number of employees, micro-enterprises with the highest growth were found in the largest cities of Helsinki, Espoo, Tampere and Oulu, but also in smaller municipalities. In this context, high growth micro-enterprises refer to micro-enterprises whose personnel had grown from the 2018 level annually by at least 10 per cent on average by 2021.
The largest main industries of micro-enterprises in 2021 were agriculture, forestry and fisheries (22.7%), professional, scientific and technical activities (13.3%) and wholesale and retail trade (12.4%).
In Statistics on micro-enterprises, the industries are presented in more detail with the accuracy of the two highest class levels of the standard industrial classification TOL 2008, in which case the most common industries of micro-enterprises were plant cultivation and animal husbandry (18.9%), forestry and logging (14.1%), specialised construction activities (10.9%), other personal services (9.5%) (e.g. barber and hairdresser services), building construction (9.3%), retail trade (8.1%), health services (7.9%), land transport (7.9%) and management consulting (6%).
The micro-enterprises defined here as employer micro-enterprises are micro-enterprises whose staff size was at least 1.5. The largest industries of employer micro-enterprises were specialised construction activities (16.7%), building construction (12.6%), retail trade (12.6%), land transport (12.4%) and catering (11.7%). The most common industries of solo entrepreneurs, i.e. enterprises with 0.5–1.5 persons, were plant cultivation and animal husbandry (22%), other personal services (15%), health services (12%), specialised construction activities (11.9%) and land transport (10.5%). The most common industries of part-time entrepreneurs, i.e. enterprises with fewer than half a person, were forestry (21.7%), plant cultivation and animal husbandry (18.4%) and real estate (10.5%).
Finland was roughly divided into two parts based on the most common sector in sub-regions. Agriculture and forestry were concentrated in Northern and Eastern Finland, and agriculture, i.e. cereal cultivation and animal husbandry, covered other municipalities. Individual exceptions include the neighbouring areas of large cities; the most common sector was health services in Oulu, other personal services in Tampere, the operations of headquarters and management consulting in the Helsinki Metropolitan Area, specialised construction activities in Turku and transport services in Enontekiö.
The most common sector of employer micro-enterprises was transport in the northern sub-regions, crop cultivation and animal husbandry in the strip south of Oulu, and construction in the southern part of Finland. The most common sector for solo entrepreneurs was plant cultivation and animal husbandry in almost all parts of the country. However, the most common sector for solo entrepreneurs was land transport in the northernmost sub-regions, health services in Helsinki and Oulu and other personal services in the areas of Rovaniemi, Jyväskylä, Tampere and Turku. The most common sector for part-time entrepreneurs was plant cultivation and animal husbandry in Western and Southern Finland, forestry and logging in Eastern and Northern Finland, management consulting in the Helsinki Metropolitan area, real estate in Turku and building construction in Raseborg.
The updated Statistics on micro-enterprises report presents export- related matters in more detail. Municipal maps show the export of goods by micro-enterprises and the export of services in EU internal trade in relation to the population. In addition, the maps show the export figures of micro- and small enterprises for both goods and EU service exports. Micro-enterprises account for less than 1% of Finland's total exports of goods.
Regional differences in the exports of micro-enterprises are considerable, even though the exports are proportional to the population of the region in the map presentation. It is worth noting that Finland has a number of rural municipalities where the exports of micro-enterprises are clearly stronger than in urban areas, and the same phenomenon can also be found in the size class of small enterprises. Micro-enterprises engaged in exports of goods in proportion to the number of inhabitants most in Utsjoki, Nykarleby, Hankasalmi, Hausjärvi and Vironlahti. There is less export of services than export of goods in micro-enterprises and compared to the size of the population it was practised most by the micro-enterprises in Ylitornio and Närpes.
The report is based on the microdata of Statistics Finland's FIRM enterprises in the Business Register (FIRM_ENTER), which contains enterprises' annual enterprise-level basic data on enterprises' industry, location, ownership, turnover, number of personnel and salaries. With regard to exports, the report also used FIRM self-assessed tax data (FIRM_VAT) and Customs' international trade in enterprise level data (TULLI_ENTER).
Statistical analysis is limited to active companies, i.e. the companies have operated for more than six months in the statistical year, they employ more than half a person, or the balance sheet exceeds EUR 170,000, or turnover exceeds the annual statistical limit (EUR 12,273 in 2021). In addition, we have restricted the analysis to limited liability companies, general partnerships, limited partnerships, cooperatives and the sole proprietorships of natural persons.
Authors:
University of Oulu, Kerttu Saalasti Institute
Pauliina Björk, MSc (Tech), MSc, Project Researcher, Regional Excellence
Ossi Kotavaara, PhD, Adjunct professor, Research Director, Regional Excellence
Martti Saarela, PhD, LLM, MSc (Econ), Development Manager, Micro-Entrepreneurship Centre MicroENTRE
Anna-Mari Simunaniemi, PhD, Research Director, Micro-Entrepreneurship Centre MicroENTRE
Matti Muhos, DSc (Tech), Adjunct professor, Professor, Director of the Institute
Photo: Anna Shvets, Pexels
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