The Scottish Government

This item was published during the term of a previous administration that ended in April 2007

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Scottish Corporate Sector Statistics 2005-2006

11/12/2006

Scottish Corporate Sector Statistics for 2005 and 2006 are released today, providing information on Scotland's business stock, including business size and ownership.

The main points:

• The total number of private sector enterprises in Scotland rose slightly (0.1 per cent) over the past year to reach 265,435 as at March 2006. The associated employment of these enterprises increased by 1.4 per cent to 1.888 million. However, this follows a decrease in both the number of enterprises and employment between 2004 and 2005
• The total number of enterprises has increased by over 33,000 (14.4 per cent) between 1999 and 2006
• Over the last year, medium-sized enterprises (50-249 employees) accounted for a large part of the rise in the total number of businesses and associated employment, and saw the largest relative increases, 5.5 per cent and 4.6 per cent respectively. Since 2002, the numbers of medium-sized enterprises and associated employment had been declining year on year
• The number of small and medium enterprises (SMEs) and their associated employment have increased to 263,175 (up 0.1 per cent) and 989,640 (up 1.1 per cent) respectively over the past year
• Enterprises with one or more employees comprised only 35 per cent of all enterprises but provided 89 per cent of all jobs. This is similar to previous years
• The proportions of the numbers of registered businesses and associated employment of businesses with an ultimate ownership outside of Scotland remained at 3 per cent and 34 per cent respectively. Among large enterprises (250+ employees), the proportions were substantially higher at 81 per cent and 61 per cent respectively

Number of Enterprises in Scotland

All the above figures exclude central and local government

The timetable for the Corporate sector analysis has changed and is now based on a March extract from the Office for National Statistics' Inter Departmental Business Register (IDBR). This allows more timely publications and more comparable analysis with the rest of the UK. Previous analyses have been based on a November extract. To help with the transition, 2 years of March based analysis (2005 and 2006) have been made available together. Further information on the impact of the change, as well as a full set of the latest tables on business stock, is available at the publication website (link provided below).

Background:

The estimates have been constructed using data from the Inter Departmental Business Register (IDBR) operated by the Office for National Statistics, the Labour Force Survey (LFS), the Family Resources Survey (FRS) and the Survey of Personal Incomes (SPI). The IDBR extract provides an estimate of the number of enterprises registered for VAT and/or PAYE. A procedure that combines data from the IDBR with estimates derived from the LFS, FRS and SPI is used to estimate the number of unregistered enterprises.

The estimates include enterprises that operate in Scotland irrespective of whether their head office is located in Scotland or elsewhere. Each enterprises is however only counted once in Scotland irrespective of the number of local business sites.

Enterprises are classified by employee size bands on the basis of the number of their total UK employees.

The number of enterprises with no employees (where the enterprise is owned and managed by the same individual(s)) which are not registered on the IDBR is estimated from a combination of surveys which are all subject to sampling error. For example a yearly estimate of 6,000 taken from the Labour Force Survey has a 95% confidence interval of +/- 2,640. It is the nature of sampling variability that the smaller the group whose size is being estimated, the proportionately less precise that estimate is. Very small estimates are subject to larger standard errors, which can result in fluctuation between years. For this reason year on year comparisons containing the smallest size band (enterprises with no employees) should be regarded with caution.

The Labour Force Survey provides data on self-employment without employees (as first or second job). The figure for second jobs is augmented by data from the Family Resources Survey on self-employment in third jobs.

This estimate of the total number of self-employed jobs (with no employees) is compared to the self-employment registered on the IDBR in enterprises with no employees. As many self-employed people are not required to pay VAT or register for PAYE, the figure from the Labour Force Survey is generally higher.

The difference between the two figures, self-employed jobs in unregistered enterprises, is converted to additional enterprises using data from the Survey of Personal Incomes (undertaken by the Inland Revenue).

National Statistics are produced to high professional standards set out in the National Statistics Code of Practice. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.