The rate of closure for small businesses is 1.5 times the rate for medium-sized businesses, and 3.6 times the rate for large businesses, according to a survey of business sector closures by the Ministry of Industry, Trade and Labor manpower planning authority.
Similar trends prevailed in many sectors: industry, construction, retail trade, and business services, but the rate of closures in construction was significantly higher than in other sectors.
Ministry of Industry, Trade and Labor manpower planning authority chairman Benny Fefferman said that renewed economic growth in recent quarters had reduced the numbers and rate of business closures, and decreased the number of laid-off workers. He added that this was cutting back unemployment.
Despite the improvement, small business were still in a poorer position. Businesses with up to ten employees are classified as small, businesses with 11-49 employees are classified as medium-sized, and businesses with 50 or more employees are classified as large.
As expected, businesses in the Tel Aviv and central regions had a low closure rate, while businesses in the north had higher closure rates than other regions in Israel.
The survey found that 28,500 out of 154,000 businesses with at least one hired employee, 18.4%, had closed down between the second quarter of 2002 and the first quarter of 2004.
172,000 employees worked in the businesses that closed down during this period, 9% of the total number of business employees.
Published by Globes [online] - www.globes.co.il - on September 28, 2004