Business dynamics (firm entry, growth, exit, and the reallocation of employment) are crucial for addressing key policy challenges related to productivity and economic growth, inclusiveness, and the green transition. Firm churning (the entry and exit of firms) fuels creative destruction, with new firms introducing innovative technologies and practices. Alongside employment reallocation, firm churning can also help ensure that resources are allocated efficiently. The formation and growth of start-ups not only contributes to more competitive markets and long-term productivity growth, but also supports inclusive job creation, with lower gender wage gaps and job opportunities for disadvantaged groups. Business dynamics can also support the transition toward a greener economy through increased green innovation and reallocation of economic activity to growing cleaner sectors. However, many OECD Members have experienced a decline in business dynamism over the last few decades, likely undermining productivity and economic growth, inclusiveness, and the green transition. The OECD Insights on productivity and business dynamics – Country notes present new findings on business dynamics for 8 countries from the OECD DynEmp project based on data covering the period 2004-22. The DynEmp project collects harmonised micro-aggregated data for the analysis of business and employment dynamics across countries.
OECD Insights on Productivity and Business Dynamics: Slovenia
