Dr Michael Anyadike-Danes

Senior Lecturer, Aston Business School

Michael has pioneered the use of the ONS Business Structures Database to study firm-level performance in the UK in a collaboration between the Economic Research Institute of Northern Ireland and Aston University.

Biography

Dr Michael Anyadike-Danes joined Aston Business School in December 2011, having spent the previous four years as Head of Research at the Economic Research Institute of Northern Ireland. Michael has pioneered the use of the ONS Business Structures Database to study firm-level performance in the UK in a collaboration between the Economic Research Institute of Northern Ireland and Aston University. A widely cited report for NESTA in 2009 investigated the importance of high growth firms (HGFs) in the UK and their impact on job creation, and the report was used by NESTA to draw attention to the role of HGFs (christened by them the “vital 6%”). The longitudinal firm-level database compiled by Michael for this study formed the basis of the UK’s contribution to the international comparative study of HGFs coordinated by FORA (the Danish small firm development agency) and subsequently used to produce tables for the OECD/EUROSTAT publication “Entrepreneurship at a Glance”. Together with Dan Johansson (of the Swedish HUI research institute) Michael has organised an international collaboration to compare across countries the evolution of the cohort of firms born in 1998, currently there  are seven countries involved (Austria, Finland, Germany, Netherlands, Norway, Sweden and the UK). More recently the data work has been updated, extended with reports being produced for a number of public sector business support agencies, amongst them: Department for Business Innovation and Skills, Invest Northern Ireland, Scottish Enterprise and Leeds City Region. Michael is an Associate Editor of the Cambridge Journal of Economics and a fellow of the Academy of Social Sciences.

Insight

High performing firms and job creation: a longitudinal analysis (1998-2013) ERC Insight Paper

The OECD High-Growth Firm (HGF) measure was a pragmatic solution to a practical problem. It was designed to assist in identifying the small group of firms which contributed disproportionately to job creation. This statistic could be used to inform national policy and to make comparisons across countries, since it could be readily replicated using business register data. The decade since the measure was first published has seen increasing dissatisfaction amongst the academics and policymakers seeking to make use of it. There are two important criticisms. First, it focuses attention on relatively short ‘bursts’ of growth rendering invisible the reality of growth for the majority of businesses, and second, it does not in fact capture some important members of its target group the ‘relatively small proportion of firms that contribute disproportionately to job creation’.
We present a new analysis of job creation in the UK, using data on a cohort of start-ups born in 1998 to identify three different groups of high performing firms. Of these three groups we find that HGFs as defined by the OCED do not create the most jobs, in fact they grow more slowly and have a lower survival rate than the comparators. Notably, though, most of the observed growth in all three groups takes place within the first five years after start-up.

Associated Themes
  • Business Demography Research Theme
Insight

Spatial Incidence of High Growth Firms.

High-Growth Firms (HGFs) are a very small proportion of the UK business population yet they have a disproportionate impact on job creation.
We present data at local economic area level over time to show that there is a very distinct geography emerging for the incidence rate of HGFs since the recession.

Associated Themes
  • Business Demography Research Theme
Insight

Contribution to Job Creation by High Growth SMEs.

High-Growth Firms (HGFs) are a very small proportion of UK businesses population yet they have a disproportionate impact on job creation. We re-visit the issue to confirm that typically, over a three year period, high growth SMEs represent less than 1% of established businesses, but generate 20% of all job growth amongst established businesses which grow

Associated Themes
  • Business Demography Research Theme
Insight

UK’s Hidden Growth Champions

The Enterprise Research Centre (ERC) has developed an alternative approach to identifying groups of fast-growing firms which contribute disproportionately to job creation and output. This will have significant implications for policy discussions on the relative importance of SMEs and which types of firms drive growth in the economy.

Associated Themes
  • Business Demography Research Theme
Insight

Moving on from the ‘Vital 6%’

High-Growth Firms (HGFs) represent only a small minority - the ‘Vital 6%’ - of the UK business population yet they have a disproportionate impact on job creation and innovation. This paper confirms the headline conclusion for job creation: that is, a small number of job creating firms (mostly small firms) are responsible for a significant amount of net job creation in the UK. It also suggests the existence of a smaller group of 'extraordinarily prolific job creating firms' who were micro firms in 1998 and now employ almost 100,000 people.

Associated Themes
  • Business Demography Research Theme
Research Paper

Localisation of Industrial Activity across England’s LEPs: 2008 & 2012 .Research Paper No 15.

The Department for Business, Innovation & Skills commissioned the ERC to undertake an analysis of industrial clusters in the UK and to use the new Local Enterprise Partnerships (LEPs) as the sub-national spatial frame in England. The analysis is designed as an information source for the LEPs as they prepare their new strategic economic plans.

Associated Themes
  • Business Demography Research Theme
Research Paper

Accounting for Job Growth .Research Paper No 2

It has recently been recognised that conclusions about firm size were confounded by the effect of the age of the firm. This paper explores the role of size, controlling for age, by comparing the cohorts of firms born in 1998 over their first decade of life.

Associated Themes
  • Business Demography Research Theme
White Paper

Firm Dynamics and Job Creation in the UK. White Paper No 6.

A consistent theme in the discussion of attempts to stimulate economic recovery in the UK is a recognition of the need to unlock the growth potential of the private sector. This paper explores the simple question – “What types of firms create the most jobs in the UK economy?”

Associated Themes
  • Business Demography Research Theme