The Small Business Climate in Different Countries

My name is Martin Lindeskog and I have been given the great opportunity to do some guest blogging. If you are interested to learn more about me, please read Anita Campbell's PowerBlog Review of my EGO blog. In preparation for writing a guest post, I read Wayne Hurlbert's post, Guest blogging: Higher profile.

I have been thinking on how the small business climate is quite different around the world. I invite the readers of this blog and fellow bloggers to comment on this post and inform about how the situation is in different countries. I have searched for information on Sweden and America. Here are some of my findings:

99.6% of the companies in Sweden could be classified as small businesses. I used the size class 01 - 06 (0 - 99 employees). The information is gathered from Statistics Sweden's Business Register and the Confederation of Swedish Enterprise (Facts about Sweden's economy 2004, page 51).

I must admit that I am a bit surprised by the high number of small businesses in Sweden. According to a 10 year old article (Is America Really Different?) in the Inc. Magazine, Europe is on the same high level as America. Here is an excerpt from John Case's article.

Paul D. Reynolds, Paul T. Babson Professor in Entrepreneurial Studies at Babson College, in Wellesley, Mass., points out that the information we have doesn't allow us to make easy comparisons. "The best we can say is that most industrialized nations have comparable rates of entrepreneurial activity," he says, adding that regional variations within countries are much more dramatic than variations among countries. (Inc.com/magazine, May 1996.)

Comparing my life here in Sweden and my study and work period in America between 1997 - 2002, I think it is definitively a different business climate in Sweden than in America. It is hard to put the finger on it, but the following excerpt from an article by James C. Cooper and Kathleen Madigan (U.S.: Weak Payrolls Mask A Tightening Job Market) in Business Week will hopefully give you an indication.

The importance of the entrepreneur is also evident in recent comments from the National Federation of Independent Businesses, which represents small companies. NFIB's surveys of its 600,000 members indicate job creation among small businesses is "much more consistent with the household survey than the payroll survey." Corroborating that, the personal income created from proprietorships is growing at an annual rate of 10.5% so far this year, up from a 9.2% pace for all of last year and twice the pace of income from wages and salaries. (BusinessWeek.com/magazine, 06/20/05.)

I will try to find figures for Sweden, but I could bet on that Sweden has a lower rate of income created by small businesses than America.

I hope that the American sense-of-life and the entrepreneurial spirit will continue to be strong, and that small businesses will thrive in competition with bigger companies on a free market based on the ideas of laissez-faire capitalism.