Saxon Report on Medium-Sized Businesses 2018 – 2022

Tasks

According to the EU definition, the vast majority of businesses in Saxony are small or medium-sized. According to the business register, 99.6% of all companies in Saxony employ less than 250 persons. Only companies in manufacturing (in 186 cases) and healthcare and social welfare (in 196 cases) report having more employees. Additionally, there are 17 300 legally independent subsidiary businesses registered in Saxony, almost a third of which (about 5 400) are belong to the trade sector. The aim of the project is to analyze and document the development and structure of small and medium-sized enterprises in Saxony from 2018 to 2022.

Methods

The first stage of the report entails the continuation of the previous Saxon Report on Medium-Sized Businesses 2015-2017. Aside from that, the new report will capture long-term development trends. Should it prove impossible to distinguish between different sizes of companies, aggregate data for Saxony will be reported.

Data and other sources

Administrative data from various sources for Germany and Saxony are used for the creation of the Saxon Report on Medium-Sized Businesses 2018-2022.

Results

It was found that the proportion of turnover generated by small and medium-sized enterprises in Saxony is significantly higher than the average for Germany as a whole, which illustrates the particular importance of SMEs for the Saxon economy. Micro-enterprises are by far the largest sub-group in Saxony's SME sector. Since 2014, Saxony's SMEs have been able to significantly increase their turnover per company, which can be attributed in particular to increases in turnover among micro-enterprises. In terms of employment, the Saxon SME sector is also more important in Saxony than in Germany as a whole. There is a downward trend in the number of micro-enterprises (1-9 employees), while the number of small (10-49 employees) and medium-sized enterprises (50-249 employees) is increasing. The number of employees in micro-enterprises is also falling, whereas it is rising for large enterprises (more than 250 employees). Using data from the IAB Establishment History Panel, the growth dynamics of Saxon establishments were also examined in comparison to eastern and western Germany. In all regions, the majority of businesses in 2021 were still in the same size category as ten years previously. Overall, growth momentum in western Germany is somewhat more pronounced than in Saxony and eastern Germany, but the differences are only slight in many areas. Saxony is only slightly more dynamic than eastern and western Germany in the transition from medium-sized to large companies. Finally, a SWOT analysis was carried out based on the structural characteristics of SMEs in Saxony. The SME report was supplemented by an empirical analysis of social enterprises in Saxony; this was carried out by our cooperation partner ZSH.