During the period 2016-2019, there were 1674 high growth enterprises (HGEs) measured in average annualised turnover growth greater than 10% per annum over a three-year period. In 2019, there were over 30 thousands persons employed with combined turnover of 980 billion ISK in high growth enterprises.

The number of high growth enterprises decreased significantly between years, from 2007 in 2018 to 1674 in 2019, or by 17% between years. Mostly, that decrease could be explained by decline in tourism industries, from 318 in 2018 to 198 in 2019, or by 38%. The highest decline in the number of HGEs was for enterprises with 10 or more persons employed, or by 50% between years.

The highest number of HGEs was in construction related industries, or 483 in 2019. However, their number decreased as well, by 12% with respect to 2018.

There was an increase in the number of HGEs both in fisheries and high technology manufacturing and services. That rise was mostly observed in enterprises with 10 or more persons employed and 2 to 4 persons employed.

High growth enterprises (HGEs) are measured, as well, in paid employment. Enterprises, with 1 to 9 employees in the beginning of growth period, are defined as high growth enterprises (HGEs) when an increase in paid employment is 3.31 employees or greater over a three-year period. Enterprises, with 10 or more employees in the beginning of growth period, are defined as HGEs when average annualised growth in paid employment is greater than 10% per annum over a three-year period.

During the period 2016-2019, there were 661 high growth enterprises (HGEs) measured in paid employment. In 2019, there were over 23 thousands persons employed by HGEs with combined turnover of 730 billion ISK.

The number of HGEs decreased significantly between the years 2018-2019, from 752 to 661, or by 12%. Mostly, that decrease could be explained by declines in tourism industries, or by 17%, and wholesale and retail trade, or by 25%.

To be precise, the number of HGEs with 10 or more persons employed decreased by 32% in tourism industries, from 68 in 2018 to 46 in 2019. This was a continuation of a trend that began in 2018. As well, the number of HGEs with 10 or more persons employed decreased by 37% in wholesale and retail trade, from 68 in 2018 to 43 in 2019.

By the end of 2019, the highest number of HGEs measured in paid employment was in construction related industries, or 180 enterprises. However, this number is almost unchanged from 2018, when they were 179. As a matter of fact, no business division was measured with an increase in the number of high growth enterprises measured in paid employment in 2019.

The share of HGEs with 10 or more persons employed in the business economy was 23.9% measured in paid employment, and 30.2% for HGEs measured in turnover by the end of 2019.

The highest share of HGEs measured in paid employment was in construction related industries, or 41.9%, and the lowest in fisheries, or 13.3% for enterprises with 10 or more persons employed in 2019.

The highest share of HGEs measured in turnover was, as well, in construction related industries, or 51.6% for enterprises with 10 or more persons employed in 2019. The lowest share was in tourism industries in Iceland, or 19.4%, and has not been as low since computations began.

Out of 32,276 active enterprises in 2019, 3,782 enterprises started operations in the business economy. That year, the most enterprise births were in construction, a total of 627 enterprises. In tourism industries, 523 enterprises were born in 2019 in comparison to 504 enterprises in 2018 and 675 in 2017.

In 2019, the birth rate of enterprises in the total business economy was 11.7%. However, the birth rate of enterprises varies depending on economic activity. In 2019, the lowest birth rate was in fisheries, or 7.1%, and the highest birth rate, 13.3%, was in high technology manufacturing and services.

The birth rate of enterprises broken down by business divisions in 2014–2019
Business divisions/ special aggregates Year The number of
active enterprises
The number of births
of enterprises
The birth rate of
enterprises
Total business economy including fisheries and
excluding financial and insurance activities
2014 28583 3574 12.5%
2015 29075 3474 11.9%
2016 306004197 13.7%
2017 31333 3834 12.2%
2018 31705 3578 11.3%
2019 32276 3782 11.7%
Fisheries 2014 1489 99 6.6%
2015 1450 97 6.7%
2016 1450 125 8.6%
2017 1375 64 4.7%
2018 1326 74 5.6%
2019 1304 93 7.1%
Manufacturing excluding fish processing 2014 1823 130 7.1%
2015 1799 141 7.8%
2016 1881 189 10.0%
2017 1881 157 8.3%
2018 1835 109 5.9%
2019 1802 137 7.6%
Construction, mining and quarrying 2014 4745 574 12.1%
2015 4861 612 12.6%
2016 5115 685 13.4%
2017 5351 673 12.6%
2018 5435 619 11.4%
2019 5557 627 11.3%
Wholesale and retail trade; repair of motor
vehicles and motorcycles
2014 4048 430 10.6%
2015 4023 404 10.0%
2016 4093447 10.9%
2017 4106 420 10.2%
2018 4102 400 9.8%
2019 4092 406 9.9%
Tourism industries in Iceland* 2014 3120 491 15.7%
2015 3469 570 16.4%
2016 4042 782 19.3%
2017 4380 675 15.4%
2018 4466 504 11.3%
2019 4579 523 11.4%
High technology manufacturing and services** 2014 2031 319 15.7%
2015 2008 271 13.5%
2016 2078 294 14.1%
2017 2104 286 13.6%
2018 2098 244 11.6%
2019 2127 282 13.3%

Enterprise means both juridical entities and natural persons that are operating under their own ID number. Enterprises that started operations in the total business economy during 2019 had over 3,800 persons employed and around 38.2 billion ISK in turnover.

The one-year survival rate of enterprises, which were born in 2018 and still were active one-year later, was 74.5% in the total business economy. That survival rate has not been lower since 2009 for enterprises that were born in 2008. The highest one-year survival rate of enterprises, which were born in 2018 and still were active one-year later, or in 2019, was in tourism industries, or 80.6%, and the lowest 68.9% in high technology manufacturing and services.

The five-year survival rate of enterprises, which were born in 2014 and still were active five-year later, or in 2019, was 39.5% in the total business economy. That rate was the highest in tourism industries, or 48.5%, and the lowest 33.3% in fisheries.

The one-year and the five-year survival rates of enterprises broken down by business divisions in 2015–2019
Year Total business economy
including fisheries and
excluding financial and
insurance activities
Manufacturing
excluding fish
processing
Fisheries Construction, mining
and quarrying
Wholesale and retail
trade; repair of motor
vehicles and motorcycles
Tourism industries in
Iceland*
High technology
manufacturing and
services**
The one-year survival rate of
enterprises, %
2015 78.2 73.8 74.7 77.5 81.6 85.3 74.9
2016 80 86.5 77.3 81.2 81.2 84.4 76.8
2017 79.3 79.4 76 82.5 80.8 82.5 72.8
2018 76.3 80.3 76.6 76.7 78.1 81.8 70.3
2019 74.5 69.7 74.3 77.5 79 80.6 68.9
The five-year survival rate
of enterprises, %
2015 38.4 45.6 42.1 33.9 42.2 48.2 34.2
2016 39.2 43.5 50 30.6 41.1 46.2 40
2017 41.9 41.4 47.9 42.4 40 51.2 32.3
2018 41.8 40.9 52.9 37.9 42.9 53.5 39.4
2019 39.5 40.8 33.3 38.3 45.1 48.5 36.1

Enterprises deaths population consists from enterprises with neither turnover nor persons employed for two calendar years. 3,095 enterprises in the business economy discontinued operations in 2017. Individuals with operation on their own personal identification number are included in enterprise definition, as well. These enterprises’ combine turnover was over 19 billion ISK in 2017. And the number of persons employed in these enterprises was over 2,900. However, the death rate of enterprises, which discontinued operations in 2017, was identical in comparison with 2016, or 9.9%.

Methods
Business Demography Statistics are based on Eurostat and OECD harmonised methodologies. Therefore, they are comparable with statistics in other European countries. The statistics are based on tax returns of enterprises and individuals. It covers the private sector except agriculture, financial and insurance services. Public administration, health and social services, educational activities, cultural, sporting and recreational activities, as well as NGO activities, are excluded.

The statistics that are now published are for the period 2003-2019 and are broken down by industry according to ÍSAT2008.

Enterprises are considered active when they have operating income or personnel costs. When operation of enterprise moves between identification numbers, it is not considered to be an enterprise birth unless two of the following three conditions are met; operation is in another economic sector according to ÍSAT2008, operation is carried out at another location or the majority of staff has been changed. Adjustments are also made in connection with mergers and split-offs.

Enterprises newly born in t having survived to t+5 are enterprises that were active in terms of turnover and/or paid employment in any part of year t+1, t+2, t+3, t+4 and t+5 (= survival without changes). During data processing, corrections are made.

* Transport (total); Accommodation, food and beverages; Renting and leasing of motor vehicles, recreational and sports goods; Travel agency, tour operator and other reservation service and related activities; Service activities incidental to air transportation; Physical well-being activities.
** Manufacture of chemicals and chemical products; Manufacture of weapons and ammunition; Manufacture of computer, electronic and optical products; Manufacture of electrical equipment; Manufacture of machinery and equipment n.e.c.; Manufacture of motor vehicles, trailers and semi-trailers; Manufacture of other transport equipment; Manufacture of medical and dental instruments and supplies; Postal and courier activities; Publishing activities; Programming and broadcasting activities; Telecommunications; Computer programming, consultancy and related activities; Information service activities; Scientific research and development.

Amounts are at current prices.

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