New Census Bureau Data for Entrepreneurship Research Ron S Jarmin US Census Bureau OECD November 19, 2007 This report is released to inform interested parties of ongoing research and to encourage discussion of work in progress. The views expressed are not necessarily those of the U.S. Census Bureau. Introduction • Statistical Agencies, such as the Census Bureau, produce a wealth of information about the business population. • Publicly available data, however, have shortcomings for entrepreneurship research. – Insufficient attention to dynamics – No explicit role for business age Raw materials for better data mostly already exist • Survey and Administrative Micro Data sitting in most statistical agencies contain much of what’s needed. • But need substantial value added before useful to skilled micro data researchers or ready for use in public release tabulations. Census Bureau Micro Data Infrastructure for Entrepreneurship Research • Longitudinal Business Database (LBD) • Integrated Longitudinal Business Database (ILBD = LBD + Selfemployed) • LEHD – Linked employer-employee data • Economic Census and Survey data New public release products being developed from the LBD • Business Demography Series (BDS) – Public release tabulations (follow EIP protocols where appropriate) – Developed with support from the Kauffman Foundation – First tables to be released soon. • Synthetic LBD – Releasable micro data based on multiple imputation – Developed with support from the National Science Foundation – Much work needed before release The BDS • New Census public use files from LBD/BR (support from Kauffman Foundation) – – – – Coverage 1976-2005 CBP Universe Establishment level with firm characteristics Focus on both business and employment dynamics • Unique Features – Long Time Series – Firm and Establishment Age – Interactions with Firm and Establishment Size The BDS – Current State • Statistics – Establishment and Firm Births, Deaths and Continuers – Job creation • From births and expansions – Job destruction • From deaths and contractions – Excess Job Reallocation • By categories – – – – Firm Age Firm Size Industrial Sector Geography The BDS • Other tables planned (e.g. high growth firms etc) • Comparisons and Measurement Issues – Differences with CBP – Differences with BED and QCEW – Measurement of Size (vs. SUSB) – Treatment of Outliers Distribution of Firms, Establishments and Employment by Firm Size Share of Firms, Establishment and Employment by Firm Size 60.00% 40.00% Firms 30.00% Estabs 20.00% Employment 10.00% 25 249 0 to 50 499 0 10 to 9 99 00 to 2 25 00 4 99 to 49 50 99 00 to 99 99 10 ,0 00 + to 10 0 to 49 50 to 19 20 to 9 10 5 to 4 to 99 0.00% 1 Share 50.00% Firm Size Distribution of Firms, Establishments and Employment by Firm Age Distributions by Firm Age Share of Firms Share of Establishments 5 g. 610 h. 11 -1 5 i. 16 -2 0 j. 21 -2 5 k l. . 26 le ft ce - 29 ns or ed f. e. 4 d. 3 c. 2 Share of Employment b. 1 a. 0 50.00% 45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Firm Age Class The BDS: Net Job Growth by Firm Size and Age 2003 Firm Size c) 10 to d) 20 to e) 50 to f) 100 to g) 250 to h) 500 to i) 1000 to j) 2500 to k) 5000 to Firm Age a) 1 to 4 b) 5 to 9 19 49 99 249 499 999 24 49 99 l) 10000+ All 0 339,847 144,122 118,152 124,100 78,268 89,849 38,351 30,727 29,004 5,425 0 0 997,845 1 623,418 328,112 281,167 253,927 106,001 71,709 36,816 27,588 24,169 3,283 10,539 -32,836 1,733,892 2 -99,061 -8,281 3,770 12,712 11,021 12,107 13,094 10,717 6,465 9,570 D D -27,886 3 -81,869 -22,618 -11,008 4,146 6,326 5,306 2,630 322 13,485 -5,427 D D -88,708 4 -64,879 -23,636 -14,366 -5,189 1,371 6,313 5,068 -2,083 -32 18,392 D D -79,040 5 -53,795 -20,872 -13,467 -2,356 8,085 12,157 10,741 8,100 6,129 21,033 1,725 -14,759 -37,280 6-10 -177,605 -88,900 -56,824 -21,691 12,002 27,347 27,342 -13,570 -17,256 22,306 5,450 28,239 -253,161 11-15 -89,750 -53,406 -37,850 -19,460 6,541 16,745 6,154 11,300 -6,593 14,953 -11,387 -1,772 -164,524 16-20 -60,659 -41,222 -33,195 -19,797 2,161 15,533 4,529 -10,091 824 27,283 -10,181 41,550 -83,267 21-25 -41,729 -26,320 -25,048 -16,381 1,068 17,734 8,734 -1,982 21,246 11,053 8,310 -9,355 -52,670 26 -16,735 -14,592 -19,511 -23,306 -2,594 19,591 16,339 5,139 -15,665 3,954 10,711 -10,318 -46,987 Left Censored -80,650 -62,418 -58,835 -50,963 -5,237 20,368 -26,119 -30,074 -51,699 -114,536 -129,216 -405,660 -995,036 All 196,536 109,968 132,985 235,743 225,011 314,759 143,677 36,094 10,078 17,289 -100,988 -401,421 919,730 The BDS: Net Job Growth by Firm Size and Age 2004 Firm Size c) 10 to d) 20 to e) 50 to f) 100 to g) 250 to h) 500 to i) 1000 to j) 2500 to k) 5000 to Firm Age a) 1 to 4 b) 5 to 9 19 49 99 249 499 999 24 49 99 l) 10000+ All 0 365,755 151,612 122,057 130,605 76,169 89,986 19,293 20,546 D D 0 0 976,023 1 650,399 356,516 304,600 287,442 133,550 91,665 32,276 16,625 12,991 587 3,861 16,306 1,906,817 2 -102,695 -8,155 3,393 8,004 3,511 10,558 11,689 10,249 11,685 D D D -51,762 3 -73,205 -20,989 -8,494 -220 4,159 9,762 -2,559 5,851 -1,133 6,279 -918 20,371 -61,096 4 -60,791 -18,095 -9,353 -740 4,485 6,271 4,224 8,610 D -3,318 D D -68,707 5 -51,906 -19,639 -10,753 -3,730 1,969 -1,139 6,732 9,953 7,085 -1,795 3,886 2,565 -56,773 6-10 -166,726 -78,086 -48,650 -22,987 10,212 9,350 5,975 7,769 8,477 -13,318 1,384 5,871 -280,729 11-15 -90,815 -46,676 -31,367 -22,671 1,570 6,374 6,285 -6,529 17,867 -358 12,058 29,005 -125,258 16-20 -60,317 -34,023 -28,206 -16,512 -6,081 -3,256 5,368 19,978 18,166 4,445 23,821 -32,039 -108,656 21-25 -40,446 -24,775 -21,086 -17,906 -9,856 -2,902 3,354 -6,837 9,965 -13,671 12,957 18,522 -92,681 26-28 -21,614 -17,066 -16,583 -17,510 -8,843 1,202 -6,929 5,725 24,181 10,620 31,926 84,747 69,856 Left Censored -89,073 -63,873 -58,319 -61,954 -38,384 -10,203 -6,843 252 -25,792 -1,004 -54,951 99,343 -310,800 All 258,568 176,751 197,240 261,822 172,461 207,668 78,865 92,191 86,961 455 36,024 246,895 1,815,898 The BDS: Net Employment by Firm Size and Age Net Job Creation: By firm age and size, 2003 800,000 a) 1 to 4 600,000 b) 5 to 9 c) 10 to 19 400,000 d) 20 to 49 e) 50 to 99 200,000 f) 100 to 249 0 g) 250 to 499 h) 500 to 999 -200,000 i) 1000 to 24 j) 2500 to 49 -400,000 g) 250 to 499 a) 1 to 4 26 16-20 6-10 4 d) 20 to 49 2 0 -600,000 j) 2500 to 49 k) 5000 to 99 l) 10000+ The BDS: Net Employment by Firm Size and Age Net Employment Change: by Firm Age and Firm Size, 2004 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 -100,000 k) 5000 to 99 i) 1000 to 24 g) 250 to 499 e) 50 to 99 -200,000 Left Censored a) 1 to 4 26-28 21-25 16-20 11-15 6-10 5 c) 10 to 19 4 3 2 1 0 -300,000 High Growth Firms High Growth Enterprises: LBD Employment # of Firms 80,000 20,000,000 60,000 15,000,000 40,000 10,000,000 20,000 5,000,000 0 0 1998 1999 2000 2001 2002 2003 2004 2005 Year Number of high growth Entreprises Employment (in high growth entreprises) Defining “Gazelles” • What is larger context? – – – – Identifying gazelles is only first step Job creation and destruction relative to old/large? Job creation in the wider economy? Tracking over a longer time horizon. What happens to them? Don’t they get eaten by lions? • Other Questions and Challenges – Role in Business cycle long time series – Wage dynamics linking to other data – What makes them successful connections to supply chain … Summary • BDS will be a rich source of information to examine – Business demography – Creative destruction/innovation – Business cycle dynamics – Role of cohorts, young/small vs. large/old – Labor market dynamics But… • Still much more limited than access to micro data. • Synthetic LBD will hopefully prove useful to a broad range of researchers including those wishing to do international comparisons.