TOP 10 Countries by Business Birth Rate (2025)
The enterprise birth rate measures how many new firms are created relative to the active business population in a given year. It is a useful indicator of business dynamism, but it does not describe the whole entrepreneurial picture on its own. Survival rates, exit rates and the structure of new firms matter just as much when comparing long-run business performance across countries.
This ranking uses the latest harmonised Eurostat business-demography data together with World Bank new-business-density figures and selected national statistical releases for a 2025 snapshot. Because official business-demography statistics are published with a lag, the comparable base for most countries is still 2022–2023.
Figures are rounded for comparability. Because publication lags differ across countries, this page should be read as an analytical comparison rather than a substitute for each national statistical release.
Methodology: How the enterprise birth rate is measured
Business demography statistics follow the Eurostat–OECD Manual on Business Demography Statistics (2007, updated 2016). Under this framework, an enterprise birth is the creation of a new combination of production factors, provided no other enterprises are involved. Mergers, break-ups, split-offs or restructuring of existing enterprises do not count as births.
Definition
Enterprise birth rate = (number of new enterprises born in year t) ÷ (number of active enterprises in year t) × 100. Only employer enterprises (or all active enterprises, depending on the national register) are included.
Data year
Latest available Eurostat business demography release (reference year 2022–2023). World Bank New Business Density data (registrations per 1,000 working-age adults) used as supplement for non-EU economies.
Processing
Values from national statistical offices are compared against Eurostat-harmonised figures. Where discrepancies exist, Eurostat figures take priority. All rates are rounded to one decimal place.
Limitations
Coverage differs across countries (employer-only vs. all active). Register-based systems may include dormant or shell companies. Ireland's figures reflect multinational-affiliate presence. Cross-country comparisons should be treated as indicative.
Key indicators tracked alongside birth rate:
- Enterprise death rate — permanent closures as % of active enterprises (excludes mergers/restructurings)
- Net entry rate — birth rate minus death rate; positive values imply a growing stock of firms
- 5-year survival rate — share of a birth cohort still active five years later; EU average ≈ 42–47%
- Churn rate — combined entry and exit; high churn can signal innovation but also fragility
Top 10 Countries by Enterprise Birth Rate — 2025 Snapshot
The top tier is dominated by small and mid-sized European economies with active service sectors, relatively low administrative barriers and business registers that capture entry quickly. Several Baltic and Southern European countries pair high birth rates with elevated exit rates, which is typical of high-churn business environments.
Lithuania has ranked at or near the top of recent Eurostat enterprise-birth tables. Strong service-sector entry and a relatively simple registration process support high formation rates. At the same time, exit rates are also high, so the country is better described as high-churn than simply high-growth. Five-year survival remains one of the weaker readings among EU peers.
Malta combines genuine domestic entrepreneurship with its role as a registration hub for EU-oriented digital and financial businesses. This dual role inflates the raw birth rate relative to economies where company registration is tied more tightly to local economic activity. Policy focus has shifted from boosting entry numbers to improving quality and survival, especially among employer-status firms that create durable jobs.
Latvia ranks third with an enterprise birth rate well above 16%, driven by active entry in trade, transport and professional services. Like Lithuania, Latvia's high birth rate is accompanied by a high death rate, reflecting an economy in rapid structural transition. The country's digital-government infrastructure has reduced friction in business registration, further boosting the absolute count of new enterprises.
Portugal consistently ranks near the top of EU birth-rate tables at around 15%, well above the EU average of roughly 10%. However, Eurostat data show that Portugal's five-year enterprise survival rate is one of the lowest in the bloc — around 33% for some cohorts — making it a textbook high-entry, low-survival economy. Tourism, construction and professional services are the main sectors driving firm creation.
Romania has seen strong enterprise formation in the 2020–2023 period, with active entry in IT services, construction and retail. The estimated 2025 position reflects that momentum. Survival has improved somewhat, but the structure of the new-firm base still suggests that many entrants remain small and vulnerable to demand or financing shocks.
Bulgaria posts a birth rate above 13% on recent Eurostat figures, placing it firmly in the high-entry tier. Low labour costs, EU single-market access and a flat tax regime attract both domestic and foreign firm formation. Churn is elevated, particularly in wholesale trade, transport and hospitality. Institutional quality and access to finance remain binding constraints on survival and growth beyond the micro-enterprise stage.
Estonia's digital public-services model, including e-Residency, has made company formation unusually fast and simple. That supports the raw count of newly registered firms, although part of the effect is administrative rather than purely domestic economic expansion. ICT, fintech and professional services remain the most visible entry sectors.
UK business demography data from the ONS show enterprise birth rates around 11–12%, above the EU average. London and the South-East record the highest sub-national rates. In 2023–2024, the enterprise death rate edged above the birth rate nationally, marking the end of a sustained post-2010 growth period in the stock of firms. In 2025, the UK remains a high-birth, high-churn economy, particularly in professional services, digital and creative sectors.
World Bank new-business-density figures place Israel among the stronger performers outside Europe. The country's venture-capital ecosystem, R&D intensity and skilled workforce support firm creation in technology, life sciences and cybersecurity. Entry quality is an important part of the Israel story, not just entry volume.
Poland's enterprise birth rate has accelerated over 2021–2023, reflecting strong domestic demand, EU-funded investment and a significant expansion of the digital economy. The country has emerged as a major outsourcing destination and a growing tech hub, which drives start-up formation in services and software. Five-year survival around 43% is above the high-churn peers in the Baltics and Iberia, suggesting that Polish new firms have somewhat stronger foundations.
Enterprise Birth Rate: Full Rankings Table (Top 20 Economies)
The table covers 20 economies with the highest enterprise birth rates in the 2025 snapshot. The EU average enterprise birth rate is approximately 10.0% (Eurostat harmonised series, 2022). The vs. EU avg index view shows each country's birth rate relative to this benchmark (EU avg = 100).
| Rank | Country | Birth Rate / Index | YoY (pp) | 5-yr Survival | Region | Income Group |
|---|---|---|---|---|---|---|
| 1 | Lithuania | 18.5%185 | +0.3 | 34% | Europe | High income |
| 2 | Malta | 17.2%172 | −0.4 | 38% | Europe | High income |
| 3 | Latvia | 16.8%168 | +0.6 | 36% | Europe | High income |
| 4 | Portugal | 15.4%154 | +0.2 | 33% | Europe | High income |
| 5 | Romania | 14.2%142 | +1.1 | 40% | Europe | High income |
| 6 | Bulgaria | 13.1%131 | +0.5 | 39% | Europe | Upper-middle income |
| 7 | Estonia | 12.7%127 | −0.2 | 42% | Europe | High income |
| 8 | United Kingdom | 11.8%118 | −0.3 | 44% | Europe | High income |
| 9 | Israel | 11.4%114 | +0.7 | 48% | Asia | High income |
| 10 | Poland | 11.2%112 | +0.9 | 43% | Europe | High income |
| 11 | United States | 10.9%109 | +0.1 | 50% | Americas | High income |
| 12 | Ireland | 10.6%106 | −0.1 | 52% | Europe | High income |
| 13 | Netherlands | 10.1%101 | +0.2 | 56% | Europe | High income |
| 14 | Canada | 10.2%102 | +0.2 | 51% | Americas | High income |
| 15 | Sweden | 9.8%98 | −0.1 | 54% | Europe | High income |
| 16 | Czechia | 9.7%97 | +0.4 | 45% | Europe | High income |
| 17 | Australia | 9.5%95 | −0.2 | 49% | Asia | High income |
| 18 | France | 9.4%94 | +0.3 | 47% | Europe | High income |
| 19 | Spain | 9.2%92 | +0.5 | 46% | Europe | High income |
| 20 | Germany | 8.9%89 | −0.2 | 52% | Europe | High income |
Sources: Eurostat Business Demography Statistics (ref. year 2022–2023); World Bank New Business Density; ONS UK Business Demography. EU average birth rate ≈ 10.0%. vs. EU avg index: 100 = EU average. YoY = year-on-year change in percentage points. Last updated: 2025.
Chart: Enterprise Birth Rate vs. 5-Year Survival (Top 10 Economies)
The chart compares enterprise birth rates with five-year survival rates for the top 10 economies in this snapshot. Read it as a comparison of entry intensity and business durability rather than as a simple scorecard. In several countries, easier entry is paired with lower medium-term survival.
Birth rate (blue) = enterprise births as % of active enterprises. Survival (orange) = % of cohort still active after 5 years. Both axes in %. Source: Eurostat Business Demography, 2022–2023.
Insights: What the 2025 business birth rate ranking reveals
High entry often comes with lower survival
One of the clearest patterns in the ranking is that countries with the highest enterprise birth rates often record weaker five-year survival. Lithuania, Portugal and Latvia fit that pattern. This does not mean high entry is a problem by itself. It means low barriers to entry usually produce a broader range of new firms, and competitive pressure removes weak entrants quickly.
By contrast, the Netherlands, Sweden and Ireland combine more moderate entry with stronger survival. They do not produce the highest volume of new firms, but the business base appears more durable over time.
The role of small economies and registration effects
Several high-ranking economies also show registration effects — administrative or tax features that support company formation beyond what domestic demand alone would produce. Malta and Estonia are the clearest examples. In both cases, business-registration design affects the raw entry count and should be kept in mind when comparing them with larger economies.
That does not make their high birth rates meaningless, but it does make interpretation more careful. A very high reading in a small registration-friendly economy is not directly equivalent to the same reading in a larger domestic-demand economy.
Eastern Europe and Western Europe do not show the same business-demography profile
Central and Eastern European economies fill most of the top ten positions. Lower operating costs, easier entry in services and logistics, and continued structural adjustment all help explain that result. These economies have also shifted more labour toward sectors where the minimum scale for entry is relatively low.
Western European economies such as Germany, France and Spain sit closer to the EU average. That should not automatically be read as weakness. Larger incumbent business stocks, more mature sectors and stronger average firm productivity often produce lower entry rates but more stable business survival.
Israel and the United States reflect a different entry model
Israel and the United States reflect a different business-creation model. In both countries, firm formation is supported by deep capital markets, research capacity and strong technology sectors. Their survival rates are also higher than those of the most churn-heavy European leaders, which suggests a stronger average capital base among new firms.
The U.S. case also shows the limits of a single metric. A moderate birth rate does not prevent the country from producing one of the world's strongest start-up ecosystems. Entry quality and capital allocation matter as much as entry volume.
Key takeaways from the 2025 ranking:
- Eastern and Northern European economies dominate the top of the birth-rate ranking, driven by low barriers and rapid structural change.
- High birth rates are often accompanied by lower survival. That pattern reflects churn, not necessarily policy failure.
- Registration effects inflate birth rates in small, open economies such as Malta and Estonia; cross-country comparisons should account for this.
- The United States and Israel show that entry quality matters. Moderate-to-high birth rates paired with stronger capitalisation can produce better long-run outcomes than entry volume alone.
- Germany and the Netherlands show that a moderate birth rate paired with high survival and productivity can deliver a stronger business-demography outcome than top-of-table birth rates alone.
What this means for different readers
Business birth-rate data are published primarily for policy use, but investors, entrepreneurs and researchers can all draw practical conclusions from this ranking.
For investors and venture funds: high birth-rate jurisdictions offer a richer pipeline of early-stage deal flow but also higher failure rates. Screening for the subset of new firms with employer status, external financing and growth intent — rather than treating the raw birth count as a proxy for investable opportunity — is essential. Israel and the US score better on this dimension than the raw birth rate suggests.
For entrepreneurs: a high birth rate in your country means more competition but also a richer ecosystem of advisors, suppliers and potential co-founders. A low birth rate (Germany, France) may mean less noise but also fewer ecosystem services for early-stage companies. Survival rates are a more useful guide to the difficulty of operating in a given environment than birth rates alone.
For policymakers: maximising the birth rate is rarely the right goal. The evidence points to a better policy target: improving survival and growth of existing new entrants. Access to finance, efficient insolvency regimes, digital government services and skills development are the consistent correlates of higher survival rates. Countries such as Sweden and the Netherlands illustrate how a business sector can remain active without relying on extremely high churn.
For researchers and analysts: care is needed when using birth rates for international comparison. Methodological differences in enterprise definition (all active vs. employer enterprises), register quality and the treatment of dormant firms can generate differences of 2–4 percentage points that have nothing to do with underlying economic dynamism. Triangulating birth rates with survival data, employment growth in new cohorts and business creation intensity at sector level produces more robust conclusions.
Frequently Asked Questions
Primary Data Sources
All figures are compiled from openly available international datasets, harmonised and rounded for analytical comparability. For formal statistical or policy work, refer to the original databases and methodological documentation.
Primary source for enterprise birth rates, death rates and survival rates for EU and EEA member states. Reference populations and definitions follow the Eurostat–OECD Manual on Business Demography Statistics.
https://ec.europa.eu/eurostat/web/structural-business-statistics/business-demographyMeasures new formal company registrations per 1,000 working-age adults. Used as a supplementary indicator for non-EU economies including Israel, Canada and the United States.
https://data.worldbank.org/indicator/IC.BUS.NDNS.ZSAnnual release covering UK enterprise births, deaths, survival rates and active enterprise counts. Used for the United Kingdom's figures in this ranking.
https://www.ons.gov.uk/businessindustryandtrade/business/activitysizeandlocationReference source for Canadian business openings, closures and survival patterns used to contextualise the Canada entry in the ranking.
https://www.statcan.gc.ca/en/subjects-start/business_and_consumer_services
