FINNISH COUNTRY REPORT

- statistics of woman entrepreneurship

 

 

University of Jyväskylä

School of Business and Economics

 

Paula Kyrö

Kirsi Pohjola

Jenni Torikka

Päivi Tyrväinen

 

 

Executive summary

 

This country report is a part of the Nordic project on woman entrepreneurship that took place between 1998-2001. Since all Nordic countries had difficulties in presenting sufficiently adequate statistics on woman entrepreneurship, the project aimed at examining the gender-oriented official statistics of entrepreneurs in the Nordic countries that were available. This involved charting the statistical systems and descriptions of the definitions and concepts used, as well as delivering the available figures.

 

In Finland the importance of and need for gender-oriented statistics is explicated in the implementation policy of the Equality Act entitled the Plan of Action. This plan suggests that compiling and evaluating statistics from a gender perspective should follow the mainstreaming principles and be a continuous process. This study reveals, however, that there is still a long way to go in fulfilling these aims in the field of woman entrepreneurship.

 

Statistics Finland is the main authority for official statistics. Its four units, Population Statistics, Social Statistics, Prices and Wages Statistics, and the Business Trends, each separately produce data either about individual women or businesses. Part of these data are available in statistical publications and prospectuses-, as well as on its quite extensive web sites. Part of the data is, however, only available on special request and for a charge.

 

The available data on woman entrepreneurship were studied according to the life cycle viewpoint. It turned out that:

 

1.      Official statistics produce neither general nor gendered data relating to intentions.

 

2. From starting and closing the business there are general data, but not gendered figures. This is due to the difficulty in identifying the gender. Only part of these figures was publicly available. It also turned out that the Finnish concept of “new” did not meet the basic requirements of the European Commission’s Regulation. 

 

3. Concerning existing businesses and self-employed, three different data sources could be identified:

·        The Business Register, that generates data from firms. It was not possible to identify women- owned and managed firms. Other problems concerned the definition of “an active firm” and the estimation of an entrepreneur’s contribution.

·        The Labour Force Survey generated survey-based statistics of self-employed and family members. It gathered data on quite an extensive number of variables, but unfortunately most of the statistics were not publicly available.

·        Employment statistics gathered register-based data from the self-employed. Only part of these data was publicly available.

Both the data on the Labour Force and the Employment statistics concerned individuals. 

 

The main problems in generating gendered statistics concern identifying gender, combining individuals and businesses and creating knowledge about new activities and intentions.

 

Therefore, in order to meet the basic needs for data-gathering on woman entrepreneurship, there is a need to produce gendered data from existing databases, to increase their availability, to improve gender identification, to integrate databases, and to acquire new information about intentions and new businesses. Finally this study revealed the difficulties with the terms used. It would be beneficial to harmonise the concepts, language and terms used by different statistical units and authorities. This would make it easier to communicate and make decisions nationally and internationally. In this respect, however, knowledge of international practices would be of the utmost importance.

 

Contents

 

1      Introduction

1.1        Official data gathering on woman entrepreneurship

1.2        Woman entrepreneurship in Finland

2      Organisational structure of Statistics Finland

3      Intentions toward Entrepreneurship

4      Starting the Business

4.1        The sources for identifying new businesses

4.1.1     The Finnish Tax Administration

4.1.2     The National Board of Patents and Registration

4.1.3     Statistics Finland (SF)

4.2        Legal Business Forms

4.3        Figures on new firms and closures 1996-1998

5      Existing firms and entrepreneurs

5.1        Organisations and criteria for data-gathering

5.1.1     The Business Register – data on firms

5.1.2     Data on the self-employed and family members

5.2        Available figures about existing firms

5.3        Figures on the self-employed

5.3.1     Figures from the Labour Force Survey

5.3.2     Employment statistics – figures on entrepreneurs

5.3.3     Economic welfare statistics - households’ income

5.4 Statistics on women’s background

5.4.1 Labour force participation according to industry

5.4.2 Earnings by gender

5.4.3 Women’s educational background

6      Some gendered general statistics from the Nordic countries

7      Summary, conclusions and recommendations

7.1 Problems in creating gendered statistics

7.2 Recommendations

7.3 Summary of available statistics – what we know about woman entrepreneurship in Finland

 

Tables

 

Table 29 Identified Intentions toward entrepreneurship in Finland 1996 – 1999

Table 30 Number of new firms and closures by industry in Finland 1996-1998

Table 31 Net change of new starters by industry in Finland 1996-1998

Table 32 Net change of new firms and closures in Finland 1996-1998

Table 33 Survival degree by the year of starting in Finland 1996-1999

Table 34 Number of firms by legal form in Finland 1996-1998

Table 35 Personnel by legal form in Finland 1996-1998

Table 36 Turnover by legal form in 1996-1998

Table 37 Firms by Industry in Finland 1996-1998

Table 38 Number of personnel in different size categories in Finland 1996-1998

Table 39 Size division of firms and establishments by personnel in Finland 1996-1998

Table 40 Self-employed and their family members by industry and by gender in Finland 1996-1998

Table 41 The share of men and women self-employed and with their family members in employment  in Finland 1996-1999 (Figures include primary production)

Table 42 Work hours of employees’, self-employed and their family workers by industry in Finland 1996-1998

Table 43 Employed persons by industry and industrial status at the end of 1996

Table 44 Employed persons by industry and industrial status at the end of 1995

Table 45 Women’s sectoral employment in Finland in 1998

Table 46 Mean income of households by socio-economic group in Finland 1996-1997

Table 47 Employed labour force by gender and by industry in Finland 1996-1998

Table 48 Employed labour force by gender and by industry in Finland 1996-1998

Table 49 Average monthly earnings of employees by gender in Finland 1996-1998

Table 50 Educated population in Finland 1996-1997

Table 51 Population with educational qualifications by field of education and gender at the end of 1997

Table 52 Females with educational qualifications by level of education in Finland 1996-1997 1)

Table 53 Employment by gender and industry in the Nordic countries 1996-1997

Table 54 Proportion of women in part-time employment in the Nordic countries 1994-1996

Table 55 Part-time work and women's labour force participation in 1995 (countries are classified in ascending rate of part-time employment)

 

figures

 

Figure 2 The organisational structure of the official statistics of entrepreneurs and enterprises in Finland.

Figure 3 Different registers for business activities in Finland

 

 

1         Introduction

 

1.1         Official data gathering on woman entrepreneurship

 

This study is a part of the Nordic project on woman entrepreneurship that took place between 1998-2001. Since all Nordic countries had difficulties in presenting sufficiently adequate statistics on woman entrepreneurship, the project aimed at examining the gender-oriented official statistics of entrepreneurship in the Nordic countries that were available. This involved charting the statistical systems and the descriptions of the definitions and concepts used, as well as delivering the available, most recent figures.

 

The data-gathering for this report has been prepared in several phases. Dr. Kirsi Pohjola started the data-gathering in spring 2000. Päivi Tyrväinen continued this work during 2000-2001, also preparing the first draft of the preliminary report. This report followed the list of questions prepared in the Nordic project proposal (see Introduction to Volume II). Part of that data, accompanied by several amendments, is used in preparing this final report. Jenni Torikka has helped in this phase. Paula Kyrö has been responsible for supervising the data-gathering process and writing this final report. She is also responsible for the choices made between  statistics, their interpretation and the recommendations. 

 

The report is divided into seven chapters. Chapter 1 - “Introduction” - gives a short overview of women’s current position in the labour market and as entrepreneurs. It is mainly based on the statistics presented later in this report. Chapter 2 describes shortly the organisational structure of generating statistics and its relationship to Finnish equality policy. Chapters 3 to 5 follow closely the life cycle of entrepreneurship starting from intentions, then describing the start-up and closures and finally delineating the existing businesses and entrepreneurs. Each chapter describes first how the data are gathered and what kinds of concepts are used, following which the actual, most recently-available statistics are presented. These entrepreneurship chapters are followed by some statistics describing women’s background. Chapter 6 presents a few gendered statistics from Nordic countries that might give some perspective on our mutual situation. Chapter 7 summarises the results of both statistical systems and available figures, ending up with final conclusions and recommendations.

 

1.2        Woman entrepreneurship in Finland [1]

 

In Finland, the start of women’s equal possibilities to earn a living and to work in business life can be traced to the end of the 19th and to the beginning of the 20th century. At that time trade and occupations were liberated, and universal suffrage was granted. Women’s possibilities for participating in the labour market have improved since then, especially with the advancements in social security legislation in the 1970’s. Women’s share of employment was already 46 % in the 1960’s, when their proportion of the self-employed was 29 %. A comparison of these figures to those at the end of the 1990’s indicates that not much has really changed, since now women’s share of employees varies on both sides of the 50 % and their proportion of the self-employed is 1/3. They also seem to have about 15-17 % less part-time jobs than their Nordic counterparts, indicating that they work outside home as much as men.

 

This equal participation in the work market does not, however, mean similarity, since women and men, both as self-employed and as employees, are located in different industries. Women also have different educational backgrounds and work in different sectors than men.

 

As self-employed, women dominate the hotel and restaurant industries as well as subsectors of the social and health services. Men clearly dominate in manufacturing and construction as well as in the transport, financial and rental industries.

 

As employees, women dominate in the hotel and restaurant industries, in finance, training, the health and social services, employer households, international organisations and foreign representation. Men dominate in the industries of primary production, manufacturing, electricity, construction and transport, as well as in storage and communications.

 

These differences are also visible in educational background. Males dominate in technical fields, trade, craft and industrial programmes. Females are predominant in private and public sector services.

 

Since 1960’s women’s proportion has increased in the public sector from 40 %, to 68 % in 1998. At the same time the number of public sector employees has doubled.

 

Professor Elisabeth Sundin’s studies from Sweden indicate similar results. According to her, women and men actually compete within a limited market as employees or entrepreneurs.[2] 

 

In order to reflect these differences in women’s minor share as entrepreneurs, I combined private sector employees and entrepreneurs from the 1998 Employment statistics, and I then looked at the proportional differences. Now the difference between men and women entrepreneurs was only 3 %. This combines the discussion about woman entrepreneurship with the structures of the welfare state and more generally with the position of women-dominated fields in society.

 

Looking at these aspects, I turn to income structure and educational degrees. Women, with more than 50 % of the degrees in higher-level education, are in dominance except at the doctoral level, which is dominated by men (their share is about 60 %). Women also earn less than men in all income categories. Their average monthly earnings vary between 70 % and 85 % of the earnings of their male counterparts. Women with higher education also seem to earn less money.

 

An investigation of the current 2 % net change in the number of new firms reveals that about 20 % is generated by health, social work and other community and personal services, i.e. women-dominated industries. This indicates that there might be some changes in the future in entrepreneurship composition. However, since the data on women’s businesses are not available, it is not possible to speculate with confidence on future developments.  

 

International research findings lead us to infer that women’s firms are smaller and less profitable than those of men.[3] When the corresponding figures for Finnish ladies are combined with these findings, it seems to me that, as elsewhere, in Finland too women entrepreneurs work in less profitable and smaller service businesses. If the welfare state is still to be the buyer of these services, society is in a key position for the development of future woman entrepreneurship in Finland. This short statistical overview indicates as well that woman entrepreneurship is not a separate phenomenon, but rather is involved with the whole labour market policy and especially with public sector activities. Professor Anne Kovalainen[4] has reached similar conclusions in her studies of women’s self-employment in Finland.

 

On the other hand the myth that women are less eager to establish firms than men is not confirmed here, since their proportion as private sector actors indicates only a slight difference compared to men. 

 

 

2         Organisational structure of Statistics Finland

 

Statistics Finland produces two-thirds of all the government statistics in Finland. It delivers these data in three different categories. Firstly there are publicly-available figures, mainly published in Statistical Yearbooks and in the publication on Corporate Enterprises and Personal Businesses in Finland or available on its home pages (http://www.tilastokeskus.fi/index.html). Secondly, it is possible to order data from existing databases according to chosen variables. These services are charged according to the assignment. Finally it offers totally-customised services. We focus on the first category, and use only a few essential chargeable figures. The sources for each table are specified table by table.

 

Administratively, Statistics Finland operates under the Ministry of Finance, but is fully and independently responsible for its statistics. The general principles governing the compilation of statistics are laid down in the Statistics Act (figure 1). The vast majority of the data is obtained from diverse administrative registers, and new data is gathered only if it cannot be obtained from any other source. Government authorities have a general duty of disclosure. The duties of private enterprises, and municipal and non-profit making organisations to provide data are specified separately. All the basic information is confidential and can only be released without identification, and for research or statistical purposes. Exceptions to this are the data in the Business Register and those describing the activities of authorities. The different levels of administration are as follows:

 

1.      EU-directives define at an international level what kind of data has to be gathered

2.      The second, national level of the administration concerns the Finnish Parliament and national legislation. The Ministry of Finance defines what official statistics are gathered based on the Statistics Act.

3.      Finally, Statistics Finland gathers the data from enterprises, local government organisations and non-profit-making associations.

4.      Several other organisations also producing official statistics are listed below:

 

·        Agricultural Research Centre of Finland

·        Central Pension Security Institute

·        Social Insurance Institution of Finland

·        Ministry of Trade and Industry

·        National Board of Education

·        National Board of Patents and Registration

·        National Research and Development Centre for Welfare and Health (Stakes)

·        Arts Council of Finland

·        Ministry of Labour

·        Finnish Tax Administration

·        Population Register Centre

 

 

Figure 2 The organisational structure of the official statistics of entrepreneurs and enterprises in Finland.

 

The importance of and need for gender-oriented data is embedded in The Equality Act. This act was incorporated into law in Finland in1987, 1992 and 1995. Its implementation policy was confirmed in 1997 by the Plan of Action. This plan suggests that compiling and evaluating statistics from a gender perspective should be a mainstreaming project and as a continuing process. The body responsible for this is the Ministry of Social Affairs and Health. This means that there are two ministries involved in developing gender-oriented statistics, The Ministry of Finance, responsible for the act on statistics, and the Ministry of Social Affairs and Health, responsible for the Equality Act and its implementation.

 

 

3         Intentions toward Entrepreneurship

 

The entrepreneurial process starts with intentions. These intentions will then be actualised as the setting-up of a business. In Finland, official statistics produce neither general nor gendered data about intentions. The best alternative in this respect consists of the statistics compiled by the New Business Centres and in some respect by the Ministry of Labour. 

 

The Finnish Jobs and Society (association) was founded in Finland in 1989. Nowadays, it has 30 regional New Business Centres and 80 branch offices that have gathered data annually from their clients. One of the centres has focused on women entrepreneurs. Clients consist of persons intending to set up a firm and looking for help in evaluating their business ideas.

 

An other group of persons with intentions to start a business might be found within the customers of the Finnish Ministry of Labour. They consist of those persons participating in entrepreneurship training programmes.

 

Both of these statistics have severe shortcomings. They relate only to those activated somehow to indicate their intentions through official advisory channels. Their number is only minor compared with that of new enterprises.

 

Table 29 Identified Intentions toward entrepreneurship in Finland 1996 – 1999

 

Sources: Finnish Jobs and Society; Centre of New Enterprises, Centre of Woman Entrepreneurship 1996-2000, Ministry of Labour; Statistics of employment exchange 1996-2000 / This table is not publicly available.

 

 

4         Starting the Business

 

4.1        The sources for identifying new businesses

 

There are three major sources for identifying and/or registering new businesses: the Finnish Tax Administration, Statistics Finland (SF) with its Business Trends Unit and The National Board of Patents and Registration.

 

4.1.1        The Finnish Tax Administration

 

Starting a business must be reported to the tax officials by giving the Basic Registration and Amendment Notice. A new business then gets a corporate code (ID-code). The same form is also used for registering as VAT –liable (Value Added Tax) and as a Regular employer (= an employer paying wages regularly). At the same time one can also apply for registration in the Prepayment Tax register. All businesses have to be registered with the Prepayment Tax register in order to generate turnover. The tax authorities decide whether a business is qualified to be included in the Prepayment register. The stock of firms in the Trade register includes units which are not in the Prepayment Tax register, but also the Prepayment Tax register contains private traders other than those in the Trade register. All VAT and employer units are to be found in the Prepayment Tax register, but they also overlap with each other.

Figure 3 Different registers for business activities in Finland

 

A business is started when the tax control begins, even though the firm might have been registered earlier with the Trade register. Any changes in the information given have to be reported using the same form. 

 

Value-added taxation: VAT is a general tax on consumption levied on the commercial selling of goods and services. A company carrying on such business is liable to VAT.  Liability to VAT does not arise if a company's yearly turnover is less than FIM 50 000 (EUR 8409). In such a case an entrepreneur can register as VAT -liable if he desires to do so. Some goods and services are exempt from VAT. These are, for example, hospital and medical care, social welfare services, educational, financial and insurance services, lotteries and money games, transactions concerning bank notes as coins used as legal tender, real property including building land, certain transactions carried out by blind persons, and interpretation services for deaf persons.

 

4.1.2        The National Board of Patents and Registration

 

The National Board of Patents and Registration keeps the Trade Register of firms and individual entrepreneurs. All legal business forms are liable to register their firms. The only exceptions concern private traders. They are also liable, if they have employees outside the family, i.e. other than a spouse or an under-aged child, or of they have a permanent place of business, such as an office. However, registration is allowed if the registering person so wishes, even though these requirements are not met. This register excludes farmers and fishermen.

 

4.1.3        Statistics Finland (SF)

 

Statistics Finland has a Business Trends Unit that maintains the Business Register. The Business Register uses the registers of the Tax Administration and the National Board of Patents and Registration, as well as conducting its own survey on a yearly basis. The data it gathers is not gender-oriented, because the ID-code is the same for individuals and firms. 

 

The term ‘new starter’ concerns all those that come under tax-control. The Finnish definition of new businesses and new starters is rather extensive, including genuinely new enterprises, changes in legal forms, mergers, and changes in ownership, as well as other openings and closures for administrational reasons. Due to this, take-overs are also classified as new businesses.

 

The tax authorities provide information on firms’ openings and closures, home municipality, preliminary branch of economic activity, turnover and wages and salaries. In addition, the Business Register’s own survey is addressed to all new firms subject to value-added tax (VAT), to all multi-establishment firms and to single-establishment firms with more than 20 employees. It gathers data on the number of personnel, turnover, industry, municipality and type of owner. The industry classification is equivalent to NACE.

 

The Business Register generates statistics on new active firms. It defines an active firm as follows:

 

“A firm refers to an economic activity carried out by one or more persons for profit-making purposes. An active firm refers to an economic activity carried out by more than half of a person or its annual turnover has to be more than FIM 50 000 (EUR 8409)”.

 

Accordingly a firm is considered to be closed down, after it stops operating both as a Regular Employer and as a VAT-liable unit. A firm is also considered to be closed down if it is merged with another firm. An entrepreneur and firms also have to inform the Trade Register of the National Board of Patents and Registration when the firm closes down. The data are not available by gender. The Business Register also generates statistics of closures.

 

4.2         Legal Business Forms

 

The legal business forms that are most valid for entrepreneurship in Finland are the following:

 

·        Private Trader (includes sole proprietors and practitioners)

·        Limited partnership

·        General partnership

·        Limited Company

·        Public Limited Company

·        Co-operative

·        Housing co-operative

·        Tenant-owner’s society

·        Association for carrying on economic activity

 

4.3        Figures on new firms and closures 1996-1998

 

The following statistics on new starters and closures are not available by gender.

 

The number of new firms has decreased between 1996-1998. The net change varies considerably between industries and between years. The share of real estate, renting and business activities is largest and varies from 48% to 36%. The construction industry varies from 2% to 21%. The share of health, social work and other community and      personal services together varies from 16% to 20%. In 1998 these four together form 78% of the net change.

 

Table 30 Number of new firms and closures by industry in Finland 1996-1998

 

Source: SF; Business Register 1996-1999, Statistical Yearbook of Finland 1998 Volume 93. and 1999, Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

Table 31 Net change of new starters by industry in Finland 1996-1998

 

Source: SF; Business Register 1996-1999, Statistical Yearbook of Finland 1998 Volume 93. and 1999,  Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

The differences between tables 31 and 32 in the numbers of net changes are due to the calculations of industry division.

 

Table 32 Net change of new firms and closures in Finland 1996-1998

 

Source: SF; Business Register 1996-1999, Statistical Yearbook of Finland 1998 Volume 93. and 1999, Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

Statistics concerning survival degrees are gathered officially, but are available only on special order and for a fee. The net change of new firms is only about 2% and the survival rate after 4 years is 63%.

 

Table 33 Survival degree by the year of starting in Finland 1996-1999

 

* Advance information

Source: SF; Business Register 1996-2000. This table is not publicly available.

 

 

5         Existing firms and entrepreneurs

 

Several units within Statistics Finland gather data from existing entrepreneurs and their firms. The Business Trends Unit gathers data from enterprises and corporations, the Social Statistics Unit conducts the Labour Force Survey, the Population Statistics Unit gathers Employment statistics and Social Statistics Unit also gathers statistics on employment and working conditions. With respect to industries they use the NACE classification. The data of the Business Trends Unit concern firms, while the others gather data from individuals. First will be presented the organisations and the criteria for data-gathering and then the actual, most recently-available figures.

 

5.1        Organisations and criteria for data-gathering

 

5.1.1        The Business Register – data on firms

 

The Business Trends Unit gathers data from enterprises and corporations. The data are not gender-oriented because the ID-code is the same for firms and individual entrepreneurs. It uses the data from the Tax Administration and the National Board of Patents and Registration. Business Register statistics provide data about the number of firms and employees, turnover and legal form.

 

The Tax Administration evaluates the status of entrepreneurs using several criteria. The characteristics of an entrepreneurial activity include business, agriculture and other ways of earning income when this can be considered to be independent, the actor himself carries the risk, owns the tools and materials used in the business, when services are offered in the market, when an entrepreneur works at his own expense, when he pays his own social security fees and has insured his business. The fact that compensation is not paid during vacations or in the case of illness, or that a tax-free daily allowance is not paid during business trips is also characteristic of the independence and the risk of an entrepreneur. Therefore, an entrepreneur is considered to be a person, who carries out a business operation and who pays taxes according to the business taxation criteria. These people include:

 

·        Sole proprietors and practitioners (Private traders)

·        Liable partners of General partnerships and Limited partnerships

·        Executive employees in a Limited company, who alone or together with their family members own more than 50 % of the share capital of the company or of the number of votes

 

The statistics of the Business Register cover part of these actors, namely active firms. An active firm refers to an economic activity carried out by one or more persons for profit-making purposes with more than half of a person or with annual turnover more than FIM 50 000 (EUR 8409).

 

Within these statistics there is the problem of the entrepreneur’s own contribution. For that purpose the Business Trends Unit is developing an estimation procedure concerning the number of personnel.

 

5.1.2        Data on the self-employed and family members

 

The Labour Force Survey: this survey is administrated by the Social Statistics Unit. The data are gathered using monthly interviews. Quarterly and annual data are calculated as monthly averages or sums. The quarterly sample size is 36 000 persons. The data are gathered according to the ILO/EUROSTAT definition. Persons are divided by occupational status as unemployed, employees or self-employed. These categories are decided by the persons themselves, not by external income, tax or pension criteria.

 

A self-employed person is one who runs, either themselves or together with their spouse, their own business, farm or rented farm, or works as a practitioner or as a freelancer. Thus there are two basic categories of self-employed, i.e. a farmer and other self-employed. A self-employed person may work either alone or they may have employees. A person working in a limited company is characterised as self-employed, when they, either alone or together with their family members, own at least 50 % of the company. In addition there is the category of an unpaid family worker.

 

These Labour Force statistics are available according to gender.

 

The Social Statistics Unit also conducts its own annual survey of household income by socio-economic groups (Economic Welfare statistics). The statistics of Economic Welfare are based on Income Distribution statistics, for which the data are gathered by survey. The household composition is defined on the basis of interview data. The survey is based on a random sample of 10 000 persons taken from the Central Register of Population. The data follow the United Nation’s criteria for the definitions of employment and working hours.

 

The Social Statistics Unit is also responsible for Economic Welfare statistics. These are based on the interviews of  10 000 private households taken as a random sample. The data are also gathered from governmental registers, such as the tax databases of the National Board of Taxation and the registers of the National Pension Institute. The data are gathered on an annual basis. Both the statistics of Economic Welfare and Income Distribution follow the United Nations’ definition of usable income.

 

The Economic Welfare statistics of a household’s income are problematic, since the data

concern a so-called reference person. Usually the reference person is the one with the highest personal income, and is usually a man. Therefore, for example the category of employers and own-account workers consists mainly of men.

 

The Population Statistics Unit: Employment statistics are based on the whole population and on the data received from the statistics of the Tax Administration and from 20 other different kinds of registers, for example the National Pensions Institution, schemes under the entrepreneur’s pensions acts YEL (“The Law of entrepreneurs’ pension”) and MYEL (“The Law of agriculture entrepreneurs’ pension”). Employment figures concern the situation at the end of the year. Employment statistics use the term entrepreneur to also include employers and unpaid family workers. “Entrepreneur” refers to people within the age 15-74, who had a pension insurance for entrepreneurs during the week the research was done, and who were not unemployed on the last office day of the year, and who were neither a conscript nor in the civil service during the last week of the year. If a person had both pension insurance for entrepreneurs and a permanent job, it was required that the income from the entrepreneurship was larger than the income from the other job. An entrepreneur is also considered to be a person whose entrepreneurial income exceeds a specifically-determined income limit, providing that they are not pensioners during the week of research. The income limit is determined annually using the data from the Labour Force research. The definition of an entrepreneur also includes those family members who work in the business and have a role other than merely that of employee.

 

Employment statistics take the data on entrepreneurs from the YEL-registers, which define an entrepreneur as follows:

 

“The Law of Entrepreneurs’ Pension Insurance” (YEL). An entrepreneur is considered to be a person who is gainfully employed without having a permanent post as an employee, or a written contract. In addition to this, a family member is also considered to be an entrepreneur, if they work in the firm without a written contract of employment. Responsible partners in a General partnership or in a Limited partnership are also considered as entrepreneurs. If a person owns, either alone or with their family members, more than 50 per cent of the share capital of the company, or has more than 50 per cent of the number of votes, they are classified as an entrepreneur.

 

The data in the employment register cover, for example, education, the labour force arranged by profession, age and gender, industry, employer sector and socio-economic group. Statistics concerning professional status and employer sector based on these are publicly available on the Internet.

 

5.2        Available figures about existing firms

 

This chapter presents available figures on firms generated by the Business Register. These data are not available by gender.

 

In Finland the number of active firms has increased during the period 1996-1998. Not including farmers, the number in 1996 was 203 000 and about 16 000 more in 1998. This is an interesting finding, since the number of new firms decreased (see table 2). The reason might lie in the definition of an active firm. Firms that previously have existed but did not fulfil the requirements of an active firm have now reached that limit. Thus they were identified as an active firm, but not as a new firm. 

 

Private traders and limited companies are equally favoured, both having a share of 40%.  Limited partnership holds the second place. Other forms have minor importance (see table 7). With respect to employees and turnover, limited companies had a leading position with 82% (table 8 and 9). However, we should note that the contribution of entrepreneurs themselves is not taken into account long as they are not employees. Most often this is the case in limited companies. 

 

Table 34 Number of firms by legal form in Finland 1996-1998

 

Source: SF; Business Register 1996-1999, Corporate Enterprises and Personal Businesses in Finland 1998, Statistics Finland, Yliopistopaino, Helsinki 2000

 

Table 35 Personnel by legal form in Finland 1996-1998

 

Source: SF; Business Register 1999, Corporate Enterprises and Personal Businesses in Finland 1998, Statistics Finland, Yliopistopaino, Helsinki 2000

 

Table 36 Turnover by legal form in 1996-1998

 

Source: SF; Business Register 1996-1999, Corporate Enterprises and Personal Businesses in Finland 1998, Statistics Finland, Yliopistopaino, Helsinki 2000

 

Within different industries the changes between 1996-1998 in Finland have been minor.

 

Table 37 Firms by Industry in Finland 1996-1998

 

Source: SF; Business Register 1999, Statistical Yearbook of Finland 1999 Statistics Finland, Volume 94. Karisto, Hämeenlinna 1999

 

Firms with 100 employees or under employ about 50 % of personnel, while firms with under 10 employees employ a quarter. This means that very small units have an essential impact on the economy (see table 10). Half of the turnover is generated by the firms with less than 250 employees and a quarter by companies with less than 20 employees (see table 11).

 

Table 38 Number of personnel in different size categories in Finland 1996-1998

 

Source: SF; Business Register 1996-1999, Corporate Enterprises and Personal Businesses in Finland 1998, Statistics Finland, Yliopistopaino, Helsinki 2000

 

Table 39 Size division of firms and establishments by personnel in Finland 1996-1998

 

Source: SF; Business Register 1996-2000, Corporate Enterprises and Personal Businesses in Finland 1998, Statistics Finland, Yliopistopaino, Helsinki 2000

 

5.3        Figures on the self-employed

 

Self-employed figures are available from two different statistics: the Labour Force and the Employment statistics. Both of these have a labour market perspective of individuals as the target. The Labour Force statistics are survey based while the Employment statistics are register-based. The Labour Force Survey uses the term “self-employed”, while the Employment statistics have translated the term “self-employed” as “an entrepreneur”. In addition there are figures from the Economic Welfare statistics concerning households’ income, which are not gendered.

 

Even though these statistics involve a large number of different variables, there are very little data available on women self-employed without a special order and charge.

 

5.3.1        Figures from the Labour Force Survey

 

About 1/3 of the 320 000 self-employed are women. This number has remained quite stable, while the number of men has slightly decreased. The industry division between men and women indicates that women entrepreneurs dominate the hotel and restaurant industries, as well as subsectors of the social and health services. Men clearly dominate manufacturing and construction, as well as the transport, financial and rental industries. The self-employed share of total employment is about 15 %, 10 % for men and 5 % for women.

 

 

Table 40 Self-employed and their family members by industry and by gender in Finland 1996-1998

 

* Training, Health services and Social Services are included in industries L-Q

Source: SF; Social Statistics Unit: Labour Force Survey 1996-1999. This table is not publicly available.

 

 

 

Table 41 The share of men and women self-employed and with their family members in employment  in Finland 1996-1999 (Figures include primary production)

 

Source: SF; Social Statistics Unit: Labour Force Survey 1996-2000. This table is not publicly available.

 

Table 42 Work hours of employees’, self-employed and their family workers by industry in Finland 1996-1998

 

Source: SF; Social Statistics Unit: Labour Force Survey 1996-1999. Work hours of employees are from Statistical Yearbook of Finland 1998 Volume 93. and 1999,  Volume 94. Statistics Finland, Karisto, Hämeenlinna. Work hours of the self-employed are not publicly available.

 

5.3.2        Employment statistics – figures on entrepreneurs

 

The industrial differences between men and women are also visible in the Employment statistics. Sectoral divisions reveal that women dominate the public sector and that their proportion of entrepreneurs is about 1/3, as it was also in the Labour Force statistics.

 

Table 43 Employed persons by industry and industrial status at the end of 1996

 

1) Incl. employers and unpaid family workers

Source: SF, Population Statistics Unit: Employment statistics, Statistical Yearbook of Finland 1998 Volume 93. Statistics Finland, Karisto, Hämeenlinna

 

Table 44 Employed persons by industry and industrial status at the end of 1995

 

1) Incl. employers and unpaid family workers

Source: SF, Population Statistics Unit: Employment statistics, Statistical Yearbook of Finland 1998 Volume 93. Statistics Finland, Karisto, Hämeenlinna

 

Table 45 Women’s sectoral employment in Finland in 1998

1) Includes state and municipalities. Source: Employment statistics 1998, http://statfin.stat.fi/statweb/ Table formed 7.3.2001

5.3.3        Economic welfare statistics - households’ income

 

The statistics of mean income show that the total and disposable income of employers and self-account workers is higher than that of employees.

However, the concept of a household’s income, is problematic, since the data concern a so-called reference person. Usually the reference person is the one with the highest personal income, and usually this is a man. Therefore, for example, the category of employers and own account workers consists mainly of males.

 

Table 46 Mean income of households by socio-economic group in Finland 1996-1997

 

Source: SF; Social Statistics Unit: Economic Welfare statistics, Statistical Yearbook of Finland 1998 Volume 93. Statistics Finland, Karisto, Hämeenlinna

 

5.4 Statistics on women’s background

 

Statistics from women’s background are divided into three categories: Labour force participation according to industry, earnings and finally women’s educational background.

 

5.4.1 Labour force participation according to industry

 

Women and men participate in the labour market almost equally. The women’s share varies between 48 and -49%. As employees men dominate the industries of agriculture, trapping and forestry, fishing, mining and quarrying, manufacturing, electricity, construction and transport, storage and communications. Women dominate the hotel and restaurant industries, finance, training, the heath and social services, employer households and international organisations and foreign representation. Thus there is a similar distribution within employees as there was within entrepreneurs.

 

Table 47 Employed labour force by gender and by industry in Finland 1996-1998

 

** Advance information

Source: SF; Population Statistics Unit: Employment statistics 1996-1999, Statistical Yearbook of Finland 1998 Volume 93. and 1999,  Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

Table 48 Employed labour force by gender and by industry in Finland 1996-1998

 

Source: SF; Population Statistics Unit: Employment statistics 1996-1999, Statistical Yearbook of Finland 1998

Volume 93. and 1999, Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

This table is based on the figures in table 47.

 

5.4.2 Earnings by gender

 

As table 21 shows, women earn less than men in all income categories. Their average monthly earnings varies between 70 % and 85 % of the earnings of their male counterparts, depending on the year and income category. 

 

Table 49 Average monthly earnings of employees by gender in Finland 1996-1998

 

Source: SF; Prices and Wages Statistics Unit: Wages and Salary statistics,

Statistical Yearbook of Finland 1998 Volume 93. and 1999, Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

5.4.3 Women’s educational background

 

Women, with more 50 % of the degrees in higher-level education, are in dominance, except at the doctoral level, where men are in the majority (their share is about 60 %). Women and men dominate different fields in education, as they did as employees and as self-employed. Males dominate the technical fields, trade, craft and industrial programmes. Women are predominant in the services.

 

Table 50 Educated population in Finland 1996-1997

 

Source: SF; Employment register and The Register of Completed Education and Degrees.

1996-1999. This table is not publicly available.

 

Table 51 Population with educational qualifications by field of education and gender at the end of 1997

 

Source: SF; Population Statistics Unit: Education statistics 1998 / Statistical Yearbook of Finland 1999,

Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

Table 52 Females with educational qualifications by level of education in Finland 1996-1997 1)

 

Source: SF; Population Statistics Unit: Education statistics 1998-2000, Statistical Yearbook of Finland

1998 Volume 93. and 1999, Volume 94. Statistics Finland, Karisto, Hämeenlinna

 

6         Some gendered general statistics from the Nordic countries

 

At the Nordic level, women participate in working life almost equally with men. In all of these countries they dominate the service sector. However women also have more part-time employment than men in all of these countries. Finland has a significantly lower proportion in part-time employment (5 %) compared to the total employment figures in the Nordic countries (21-27 %).

 

Table 53 Employment by gender and industry in the Nordic countries 1996-1997

 

Source: ILO Yearbook of Labour statistics 2000

 

Table 54 Proportion of women in part-time employment in the Nordic countries 1994-1996

 

Source: CES *1997.pp. 52-63; OECD 1997, table E, p. 177 http://www.ilo.org/public/english/support/publ/revue/persp/97-4.htm

* CES is France’s Economic and Social Council

 

Table 55 Part-time work and women's labour force participation in 1995 (countries are classified in ascending rate of part-time employment)

 

Source: CES 1997, OECD; table E,p. 177, ILO 1997; c.table 1 pp. 1-12

http://www.ilo.org/public/english/support/publ/revue/persp/97-4

 

 

7         Summary, conclusions and recommendations

 

7.1 Problems in creating gendered statistics

 

This study dealt with the Finnish statistical system and its ability to produce gendered statistics about entrepreneurship.

 

In Finland the importance of and need for gender-oriented statistics is explicated in the implementation policy of the Equality Act entitled the Plan of Action. This plan suggests that compiling and evaluating statistics from a gender perspective should follow mainstreaming principles and  be a continuous process. This study reveals, however, that there is still a long way to go in fulfilling these aims in the field of woman entrepreneurship.

 

Statistics Finland is the main authority for official statistics. Its four units, Population Statistics, Social Statistics, Prices and Wages Statistics and the Business Trends, each produce separately data either on individual women or businesses. Part of these data is available in statistical publications and prospectuses as well as on its quite extensive web sites. Part of them is, however, only available for a fee. This study focused on the publicly-available statistics and their production.

 

The available data were studied according to the life cycle. It turned out that:

 

1.      Official statistics produce neither general nor gendered data regarding intentions.

 

2.      For starting and closing the business there are general data, but not gendered figures, due to the difficulty of identifying the gender. Part of these figures are not publicly available. 

 

The essential problem relating to this phase concerns the concept of “new”. The Finnish definition does not actually meet the basic requirements of the European Commission’s Regulation No 2700/98 that states:

 

“ A birth amounts to the creation of a combination of production factors with the restriction that no other enterprises are involved in the event. Births do not include entries into the population due to: mergers, break-ups, split-off or restructuring of a set of enterprises. It does not include entries into a sub-population resulting only from a change of activity.”

 

In Finland the term ‘new starter’ refers to all those that come under tax control, including genuinely new enterprises, changes in legal forms, mergers, and changes in ownership, as well as other openings and closures for administrational reasons. Due to this, take-overs are also classified as new businesses. Figures from Finland are thus not comparable to those from countries using the definition of the European Commission.

 

3.      For existing businesses and entrepreneurs we identified three different data sources:

 

§          Data about firms generated from the Business Register. Due to the ID-code, it is not possible to identify women-owned and managed firms.

 

§          Other problems in this category concerned the definition of “an active firm” and the estimation of an entrepreneur’s contribution. Both of these might have an impact on evaluating women’s contribution to business life.

 

§          The Labour Force Survey generated statistics on self-employed and family members. It gathers data on quite an extensive number of variables, but unfortunately most of the statistics concerning self-employed as well as women self-employed are not publicly available, but are charged for according to each assignment. Since this data is based on a survey, it could generate such statistics that require a self-employed’s own evaluation and opinion, e.g. data from intentions.

 

§          Employment statistics also gathered data from self-employed persons using the title of “an entrepreneur”. Only part of those data are publicly available. These data are register-based, thus using external criteria for its databases.

 

Both the Labour Force and the Employment statistics have the opposite problem to that of the Business Register. Their data concerns individuals and are not able to give data on businesses.  

 

Thus the main problems in generating gendered statistics concern identifying gender and combining individuals and businesses, as well as creating information about new activities and intentions.

 

7.2 Recommendations

 

In order to meet the basic needs for data gathering on woman entrepreneurship there is a need to

 

1.  produce gendered data from existing databases and increase their availability,

2.  improve gender identification in order to integrate existing databases, and

3.  acquire new knowledge about intentions and new businesses.

 

Following the life cycle, these needs could be stated as follows:

 

1.      Intentions are the problem that has not been dealt with in any data gathering. In practice this might be embedded as a question in the Labour Force Survey, since it requires an individual’s own opinion.

 

2.      Starting the business: In order to create gendered statistics we have to identify the gender. This is not possible with the current system. This problem might be solved either by identifying gender or by conducting a new survey. Recommending the last choice involves corrections of the Finnish definition of a “new firm or starter”.

 

3.      Existing firms, entrepreneurs and self-employed: For business units we have the same problem of gender identification as in the starting phase. For individuals we actually do have information, but this is available only on special inquiry.

 

It could be recommended that the possibility of combining individuals and firms by integrating knowledge from these databases should be further studied. On the other hand, studying how to take advantage of existing data in both the Labour Force Survey and the Employment statistics would require a deeper study of all the available possibilities.

 

This study also revealed the difficulties with the language and terms used. It would be beneficial to study and harmonise the concepts, language and terms used by different statistical units and authorities involved in the production process. This would make it easier to communicate and make decisions nationally and internationally. In this respect, however, knowledge of international practices would be of the utmost importance.

 

In order to make these suggestions more explicit, I will next describe what we know about woman entrepreneurship in Finland based on the available statistics. 

 

7.3 Summary of available statistics – what we know about woman entrepreneurship in Finland

 

According to the Business Register:

 

The number of new firms has decreased between 1996 and -1998. The net change of new firms is about 2 %. It varies considerably between industries and between years. The share of the real estate, renting and business activities is largest, and varies between 48 % and 36 %. The construction industry varies between 2 % and 21 %. The share of health, social work and other community and personal services together varies between 16 % and 20 %. In 1998 these four together comprise 78 % of the net change.

 

The number of firms has increased during the period 1996-1998. Excluding farmers, the number in 1996 was 203 000 and about 16 000 more in 1998. The reason might lie in the definition of an active firm. Firms that had previously existed but not fulfilled the requirements of an active firm now reached that limit. They have thus been identified as an active firm, but not as a new firm. 

 

Private traders and limited companies are equally favoured, both having a share of 40 %. Limited partnership holds second place. Other forms have minor importance. With respect to employees and turnover, limited companies had a leading position with 82 %. However, we should note that the contribution of entrepreneurs themselves is not taken into account as long as they are not employees. Within different industries the changes between 1996 and 1998 have been minor.

 

Firms with 100 employees or under employ about 50 % of personnel, and firms with under 10 employees employ a quarter. Half of the turnover is generated by firms with less than 250 employees and a quarter by companies with less than 20 employees. This means that very small units have an essential impact on the economy.

 

Since the data above is not available by gender, we have no indicators for evaluating women’s role in the economy, unless we combine different pieces of information from other statistics.

 

According to the Labour Force Survey, 1/3 of  the 320 000 self-employed are women. This number has remained quite stable, while the number of men has slightly decreased. The industry division between men and women indicates that women entrepreneurs dominate the hotel and restaurant industries as well as subsectors of the social and health services. Men have a clear dominance in manufacturing and construction as well as in the transport, financial and rental industries. The self-employed share of total employment is about 15 %, 10 % for men and 5 % for women.

 

The industrial differences between men and women are also visible in the Employment statistics. Sectoral divisions reveal that women dominate the public sector and that their proportion of entrepreneurs is about 1/3, as it was also in the Labour Force statistics.

 

The statistics of women’s position in the labour market reveal that women and men participate in the labour market almost equally. The share of women varies between 48 % and 49 %. As employees, men dominate the industries of agriculture, trapping and forestry, fishing, mining and quarrying, manufacturing, electricity, construction and transport, storage and communications. Women dominate the hotel and restaurant industries, finance, training, the health and social services, employer households, international organisations and foreign representation. Thus there is a similar distribution within employees as there was within entrepreneurs and self-employed. Women also earn less than men in all income categories. Their average monthly earnings vary between 70 % and 85 % of the earnings of their male counterparts, depending on the year and income category.

 

Women, with more 50 % of the degrees are preponderate in higher-level education, except at the doctoral level, where men are in the majority (their share is about 60 %). Women and men dominate different fields in education as they did as employees and as self-employed. Males are predominant in the technical fields, trade, craft and industrial programmes. Women have the domination in the private and public sector services.

 

Economic Welfare statistics of household income shows that the total and disposable income of employers and own-account workers is higher than employees. This is problematic, since the data concerns a so-called reference person. Usually the reference person is the one with the highest personal income, and as Income Distribution statistics indicate, usually this is a man. Therefore, for example, the category of employers and own-account workers consists mainly of males. Since additional information about the family members and self-employed are not available publicly, we have no statistics on women entrepreneurs in the family context. 

 

At the Nordic level, women participate in working life almost equally with men. In all of these countries women dominate the service sector. This indicates that these welfare countries might have similar problems and structures to Finland.

 

These pieces of data give us a fragmented picture of woman entrepreneurship in Finland. Different industry divisions as employees, as entrepreneurs and also with respect to educational background all indicate that women and men work in different fields. Additionally, the most active creation of new firms relates on the one hand to male-dominated, and on the other hand to women dominated industries. Income distribution figures indicate that the fields in which women are working with are less well-paid than those dominated by men. This could be assumed to have its influence on business figures. The fact that women are dominant in the public sector might be related to their lower self-employed figures.

 

These findings confirm the international studies conducted in this field. However, they do not give us enough tools to really understand this field, neither do they give us tools for supporting and improving woman entrepreneurship. For national decision-making more accurate and longitudinal knowledge is needed on women entrepreneurs and their businesses.

 

From the perspective of equality, we have rather to speculate than to actually get accurate knowledge about the different relationships. However, these figures reveal that there exist unique gender differences in the labour market, both for employees and the self-employed. There are also changes according to these differences in new businesses. We might say that it is not only the question of women per se, but rather of equality in general. Hence the recommendation in the implementation plan of the Equality Act for compiling and evaluating statistics from a gender perspective seems to be reasonable request and an essential point of departure towards a more equal society.