In 2021

Birth rate of enterprises grew compared to the previous year

The Regional Directorate of Statistics of Madeira (DREM) releases today the final data of the demographics of enterprises with headquarters in the Autonomous Region of Madeira for the period 2016-2021, by the sector of Classification of Economic Activities (CAE-rev.3) and legal form. This information comes from the Integrated Business Accounts System (SCIE) of Statistics Portugal(INE).

In 2021, 4,427 (+25.8% compared to 2020) enterprises headquartered in the Autonomous Region of Madeira were born, 60 of which were in the financial sector and 4,367 in the non-financial sector. Of that total, about three out of four were individual enterprises and one out of four were companies.

The birth of individual enterprises had a change of +18.2% compared to 2020 and -0.2% compared to 2019, while in companies’ births, there was an increase of 51.6% and 20.2% compared to 2020 and 2019, respectively.

The proportion of enterprises surviving 1 year after birth stood at 75.3% (-1.1 pp compared to 2020 and 2019) and those surviving 2 years after birth corresponded to 59.4% (-0.7 pp compared to the previous year).

The survival rate of companies continues to be much higher than that of individual enterprises when evaluating 1, 2 and 5-year survival after birth.

Main data for non-financial enterprises

In 2021, 4,367 non-financial enterprises were born in the Autonomous Region of Madeira, up by 866 (+24.7%) births than in the previous year and up by 156 (+3.7%) compared to 2019. In the country, there was an increase of 20.1% in the creation of non-financial enterprises compared to 2020 and a reduction of 5.5% compared to 2019.

The enterprises that started their activity in 2021, created 5,096 jobs and generated 80.5 million euros of turnover (+27.2% and +21.1%, compared to 2020, respectively).

In enterprises, the rate of job creation, given by the ratio between employed staff in the birth of the enterprise and total employed staff, was 6.0% in 2021, higher than the previous year's rate by 0.9 pp and lower by 0.2 pp compared to 2019.

The birth rate of non-financial enterprises headquartered in the Autonomous Region of Madeira was 14.7%, higher than in 2020 (12.2%) and the same as in 2019 (14.7%). It should be noted that the birth rate of individual enterprises (16.5%) is substantially higher than that of companies (11.3%).

With regard to the survival of enterprises, it should be noted that 75.2% of the enterprises born in 2020 remained active in 2021. For those born in 2019, that ratio was 59.3%, dropping to 50.3% for those created in 2018. The five-year survival rate for non-financial enterprises (i.e. for those born in 2016) was 35.8%.

In the year 2021, the number of deaths in non-financial enterprises is estimated to have been 3,447 (-2.3% compared to 2020 and +2.7% compared to 2019), leading to the loss of 3,705 (-11.4% and -6.4%) jobs and 39.8 million euros in turnover (-30.7% and -13.0%), respectively. 

In 2021, the job destruction rate, given by the ratio between employed staff in dead enterprises and the total employed staff, was 4.4%, -0.9 pp than in the previous year and -0.6 pp compared to 2019.

In that year, the mortality rate stood at 11.6%, lower than in the previous year (12.3%) and than in 2019 (11.7%). The mortality rate for individual enterprises (15.3%) was also much higher than for companies (4.9%).

In 2021, there were 123 high-growth companies (-10.2% compared to 2020 and -15.8% compared to 2019), with a share of 11.0% (10.7% in the country) in the total number of non-financial companies with 10 or more employees in the Autonomous Region of Madeira, accounting for 18.6% of the employed staff, 19.8% of the turnover and 23.5% of the GVA generated. In Portugal, the share was 16.0%, 13.7% and 15.5%, respectively.

These companies employed 8,071 persons (+5.7% than in 2020 and -3.2% compared to 2019), their turnover reached 804 million euros (+30.4% and +17.9%) and generated a GVA of around 309 million euros (+57.1% and +51.3%), respectively.

The number of high-growth young non-financial companies, known as "gazelles" grew from 7 to 10 in 2021. Regarding the staff employed, there was an increase of 33 persons employed to a total of 688 in 2021. The turnover decreased by 60.3% to 46.6 million euros. The 10 "gazelle" enterprises of the Autonomous Region of Madeira had, in 2021, a GVA of 23.9 million euros, -36.8% than in 2020.

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