The CSO today published a new annual report on Small Business in Ireland. The report presents a comprehensive picture of the contribution of small business in Ireland.

The report presents data on the contribution of small businesses in industry, services and construction, as well as statistics on labour costs, the knowledge economy and the labour force. It also includes international comparisons.

In the report, a small business is defined as an enterprise which employs less than 50 people. Statistics on medium (50-249 persons) and large (250 or more persons) enterprises are also included for comparison.

Key points from the report include:

Industry: Output and employment dominated by medium and large enterprises

• In 2004 four out of every five industrial enterprises (82%) were small firms employing less than 50 people. These firms employed 53,000 people, just under a quarter of total industrial employment.
• Larger enterprises (50 or more persons) employed over 182,000 people in 2004 and generated over 93% of the total turnover in Industry.
• The vast majority of small industrial firms were Irish owned (95%). Over 40% of larger firms were foreign-owned.

Services: Over 400,000 employed by small businesses in the services sector

• In the services sector, almost all enterprises (98%) are small. There were 83,500 small businesses which employed over 400,000 people in services in 2004. This was more than half of total employment in the sector.
• Small firms also accounted for more than half (52%) of the total turnover in the services sector, generating a total turnover of just under €74bn in 2004.
• Almost half of small businesses in the services sector were family owned (47%). The vast majority of these family businesses employed less than 10 people.

Construction: Small firms employ three quarters of all those working in the construction industry

• According to the Quarterly National Household Survey there were 227,400 people employed in the construction industry in the fourth quarter of 2004. Over 170,000 of these indicated that they worked in small workplaces (less than 50 employed), while 38,000 indicated that they worked in larger workplaces (50 or more persons employed). Another 19,000 did not state the number employed at their workplace.
• More than half of all those employed in the construction sector were either self-employed or worked for very small concerns employing less than ten people.

Labour Costs: Large businesses spend 25% more per employee

• The Labour Costs Survey estimated that the total labour costs of small businesses amounted to €8.5bn in 2004. This translated into an average labour cost per employee of €35,340 per annum for small businesses. The corresponding figure for medium and large enterprises was 25% higher, at €44,157 per employee per annum.
• The average wage or salary for employees in a small business was €30,280 in 2004. The average salary in larger enterprises was €37,181 per annum.

Technology and Innovation: Larger firms more active in innovation

• Small enterprises generally make less use of more advanced Information and Communication Technology than larger enterprises.
• Just under half of small enterprises engaged in innovation activity (e.g. new products or processes) in 2004 compared with two thirds of larger enterprises.
• Small firms invested €267m in R&D in 2005. This represented one fifth of total R&D expenditure by business.

Size of workplace: Over 60% of employment is in small workplaces

• Across all sectors, over 60% of employment is in workplaces where less than 50 people are employed. In total, 1,262,900 people work at small workplaces. Of these, almost 940,000 are employees, 209,000 are self-employed and 104,600 were self-employed with employees. These figures include farming and the public sector, as well as business sectors.
• Close to 200,000 non-Irish nationals were in employment in the second quarter of 2006 and more than half of these (55%) worked in small enterprises.

EU comparison: Value added in Irish construction sector firms twice the EU average

• Three quarters of manufacturing turnover in Ireland is generated by large enterprises while the EU average is 60%.
• In Ireland, small and medium sized enterprises accounted for a higher share of services sector turnover than the EU average.
• Gross value added per person employed in the construction sector in Ireland was at least double the EU average for all employment size classes.

Small Business in Ireland is available on the CSO web site (www.cso.ie (PDF 615KB) (PDF 636KB) ‌)

For copies of the publication contact:

The Central Statistics Office, Information Section, Skehard Road, Cork
Government Publications Sales Office, Sun Alliance House, Molesworth Street, Dublin 2
Price: €10

For further information:

Paul J. Crowley at (021) 453 5501 or Brian Ring at (021) 453 5747

30 May 2007

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