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Exploring the incidence and spatial distribution of high growth firms in the UK

Nesta Working Paper 13/05
Issued: March 2013
JEL Classification: F23, L25, L26, L53, R12
Keywords: High growth firms, job creation

Abstract

High growth firms have been attracting increasing attention from policymakers interested in promoting job growth. Researchers have responded by exploiting newly available large firm-level datasets to study the role of high growth firms in the dynamics of job creation and destruction. This paper uses the recently agreed OECD definition of a high growth firm - requiring sustained growth in employment, averaging 20 per cent per year over three years - to provide benchmark numbers on high growth firms for the UK compiled from the ONS Business Structure Database over the period from 1997 to 2010.

It reports counts of high growth firms and measures of incidence (high growth firm numbers relative to the size of the business population) across a set of characteristics: age; size; industrial sector; and location. It concludes with an investigation of job growth which confirms that in the UK high growth firms are, indeed, disproportionately prolific job creators.

Authors

Michael Anyadike-Danes, Karen Bonner, Mark Hart

The Nesta Working Paper Series is intended to make available early results of research undertaken or supported by Nesta and its partners in order to elicit comments and suggestions for revisions and to encourage discussion and further debate prior to publication (ISSN 2050-9820). The views expressed in this working paper are those of the author(s) and do not necessarily represent those of Nesta.