Inception meeting presentation for Project 3.- Jun Du

1. Growth Heroes and the Wider
Economy
Jun Du, Mark Hart, Karen Bonner,
Michael-Anyadike-Danes and Enrico
Vanino
Completion date: November 2016

2. Firm Productivity Growth Types
Positive Productivity Growth
• Fake Growth: contraction in
employment or where the
contraction in employment is faster
than the contraction in turnover
• Growth Hero: turnover and
employment both grow, the growth
in turnover faster than employment
• Jobless Growth: turnover increases
with either no employment growth,
or with employment contraction
Negative Productivity Growth
• Decline by Efficiency Loss: turnover
decreases but employment grows or
where employment and turnover
grow but employment growth
outpaces turnover growth
• Decline by Contraction: turnover and
employment both decrease but
turnover contracts more than
employment

3. Composition of Surviving Firms by
Growth Type

4. Aggregate Labour Productivity
Decomposition by Growth Type

5. Growth Heroes
• So, in 2013 – Growth Heroes (4% of the business population)
contribute 17% of overall aggregate labour productivity
• 1998-2013 – oscillated around 15%

6. growth in jobs
-2.5 -2 -1.5 -1 -0.5 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5
to -2 to -1.5 to -1 to -0.5 to 0 to 0.5 to 1 to 1.5 to 2 to 2.5 to 3 to 3.5 to 4 to 4.5 to 5
5 to 5.5 * * * * * * * * * * * * 15 * *
growthinturnover
4.5 to 5 * * * * * * * 11 14 16 15 14 19 17 10
4 to 4.5 * * * * * * * 16 23 38 38 24 23 14 *
3.5 to 4 * * * * * 16 29 34 51 63 74 52 22 * *
3 to 3.5 * * * * * 38 46 73 100 122 92 55 31 * *
2.5 to 3 * * * * 11 92 79 143 182 197 146 67 26 * *
2 to 2.5 * * * 30 22 125 165 224 283 281 128 55 13 * *
1.5 to 2 * * 16 35 31 305 376 488 432 279 105 19 * * *
1 to 1.5 * * 28 98 78 715 834 717 493 216 56 17 10 * *
0.5 to 1 * 11 63 215 141 1714 1249 786 380 135 25 11 * * *
0 to 0.5 12 28 102 372 276 2180 971 478 169 48 14 * * * *
-0.5 to 0 * 34 118 410 179 1174 471 220 61 20 * * * * *
-1 to -0.5 * 25 123 268 103 656 220 83 23 * * * * * *
-1.5 to -1 21 26 74 146 36 356 93 41 * * * * * * *
-2 to -1.5 19 24 46 94 21 196 52 14 * * * * * * *
-2.5 to -2 * 23 33 56 21 109 26 * * * * * * * *
-3 to -2.5 * 8 17 27 * 88 21 * * * * * * * *
-3.5 to -3 * 12 10 17 * 47 * * * * * * * * *
-4 to -3.5 * * * * * 47 14 * * * * * * * *
-4.5 to -4 * * * * * 20 * * * * * * * * *
>=10 shares(%)
A 1569 6.5
B 6995 28.9
C 4532 18.7
D 4052 16.7
E 670 2.8
F 776 3.2
G 5651 23.3
all 24245 100
ERC Analysis 2008-15 – 7,000 firms in the ‘green’
segment – the Growth Heroes in this period
1. How many Scale-ups or HGFs (OECD definition) are
in the 7,000?

7. And the relationship between job growth
and productivity growth is
negative……2008-15

8. Which Firms drive Productivity Growth?
• Build a clear profile of the characteristics of these Growth
Heroes ……but also include other groups of firms that are of
interest.
• Lines of Inquiry - the options are:
• Growth Heroes as defined in the previous productivity project
(n=~50,000) and subsequently in the 2008-15 period (n=~7,000);
• High-Growth Firms (HGFs) as OECD definition or similar definitions
(n=~12,000);
• M2000 firms (n=~400).
• Other groups of firms that portray growth tendencies

9. Wider Economy Effects?
• Two lines of thought at present:
– The intuition is that HGFs/Growth Heroes may have demonstrative
effects
– Counter-balanced by the possibility crowding out effects on other
firms in the local/regional economy
• Modelling this using BSD-FAME linked database over the
period 1998-2015

10. Contact us:
If you would like any more information about this
research please contact
Jun Du j.du@aston.ac.uk