Luxembourg’s statistics office STATEC published a new study about the state of entrepreneurship in the Grand Duchy on Friday, December 23. The study shows that the part of newly created companies rose from 7.1% in 2014 and 8.7% in 2013 to 10.2% of total companies in 2015. As GDP saw a similar development in the same time period, the study suggests that there could be a possible link between economic growth and entrepreneurial activity.
STATEC collaborated with the Ministry of Economy and the Chamber of Commerce for this study in the framework of an international program called “Global Entrepreneurship Monitoring (GEM)”, in which 61 countries participate.
2,000 residents aged from 18 to 64 were surveyed for this study. With its 10.2% of start-ups among all companies, Luxembourg finds itself ahead of its neighbouring countries and at average level of developed countries. Among these, Germany trails at the end with 4.7%, Canada is leading the list with 14.7%.
Different sources of entrepreneurship
Looking for the reasons of the growth in Luxembourg’s entrepreneurial spirit, the study found different sources. Most entrepreneurs are driven by a desire of independence, rather than out of economic necessity as is often the case in other countries. More men (11.6%) than women (8.7%) are taking the risk of becoming an entrepreneur. Immigration is an important source of entrepreneurship as well, with first generation immigrants showing a rate of 15.1% engaged in it (against 7.2% of non-immigrants and 8.4% of second generation).
The study put a special focus on social entrepreneurship, being initiatives that have a social or environmental goal. In this field, Luxembourg is leading in Europe with 7.4% of newly created companies.
A bit surprising, the study finds that 15.4% of entrepreneurs say they are “dissatisfied” with their situation, a feeling that is particularly strong among women (19%). In the general population this rate is at only 9.7%.
The study also attributes weaknesses to the Luxembourgish system of entrepreneurship, citing as a main weakness the low level of entrepreneurial education in primary and secondary school. “Experts perceive that the primary and secondary education system is not sufficiently encouraging and supporting the undertaking of personal initiatives.” Coupled with “adverse social and cultural norms (…) as barriers towards the pursuit of an entrepreneurial career”, Luxembourg’s self-proclaimed status as “start-up nation” can be completed with a question mark for the time being.