Start-ups with employees have a greater chance of survival
Approximately 360,000 new enterprise were founded in Germany in 2024. "It’s not just the number of start-ups that matters for an economy, but also their long-term survival", said Dr Rosemarie Kay, Deputy Managing Director at the IfM Bonn. Based on the recent data from the German Business Register, researchers at the institute regularly monitor the survival of newly established enterprise during their first five years. They found that 74 of the businesses founded in 2017 were still active after one year. With each additional year, the survival rate decreased continuously: after 5 years, it was only 38.1%.
Dr Rosemarie Kay constate: "Businesses with employees have slightly better chances of survival than those with no employees. After five years, just over 34% of non-employer start-ups were still in operation – compared to nearly half of those with employees."
Start-Ups in Health and Social Care Show Highest Long-Term Stability
The highest survival rate during the observation period was recorded for start-ups in the health and social services sector, followed by the manufacturing industry. The lowest survival rate was found in the arts, entertainment and recreation industry, where less than a third of the companies survived the first five years.
