Catalonia takes lead over Madrid in business creation in Spain
During 2016 more companies were created in Catalonia than in Madrid while fewer ceased business operations
BarcelonaCatalonia is the leading Spanish region in business creation, and takes over this position from Madrid, which had led since 2007. According to data published on Tuesday by Spain’s National Statistics Institute (INE), during 2016 a total of 21,781 new firms were created in Catalonia, of which 93 were joint stock companies and 21,584 were partnerships.
In Spain as a whole 101,071 new companies were registered. After Catalonia, the regions that saw the most new companies were Madrid, with 19,946; Andalusia, with 16,687, and Valencia, with 11,153 firms.
Catalonia's leadership came about after a year of strong growth. The number of businesses created grew by 15.3% in 2016, while in the whole of Spain the increase was 6.8%. In the case of Madrid, there was no change from the previous year.
In terms of business demographics, the change in Catalonia stands out not just for the high number of enterprises created, but also for the reduction in business closings.
In 2016 a total of 2,064 companies ceased to trade in Catalonia, 9.6% less than the year before. In all of Spain 21,207 companies closed down, 2.2% more than the year before. Madrid stands out, as while the number of businesses created did not grow, the number of closings grew by 9% to a total of 5,781.
Capitalization
However, the INE data show a business mix with more small and medium sized companies in Catalonia than in Madrid, with lower capital consumption. Thus, while in Catalonia 93 stock companies were created, in the Madrid region the number was almost double at 182 companies. And while the capital attached to the new companies in Madrid increased to almost €1,896 million, in Catalonia the subscribed capital was less, at €950.5 million, despite having created more companies.
In fact, the average capital of new firms in Spain is 62,300 euros. But while Madrid held second place, with 95,100 euros --following only the Balearic Islands with an average of 139,000 euros per company-- Catalonia ranked thirteenth, with an average of 43,600 euros per company.
Catalonia had not surpassed Madrid in the number of companies created since 2006, before the crisis, when Catalonia created 27,827 companies and Madrid 27,618. At that point Madrid took the lead from Catalonia and held it until 2015, when 20,051 new companies were registered in Madrid and 18,859 in Catalonia. But the trend reversed in 2016 and Catalonia moved into the lead again.
In contrast, Madrid has always had more company closures than Catalonia and the gap has been widening. Thus, in 2006 a total of 1,483 companies closed down in Catalonia, with 1,821 in Madrid-- that is, 338 more. In contrast, 2,319 companies closed in Catalonia in 2016 while in Madrid the total number was 5,356-- in other words, 3.037 more.
Although the INE does not offer detailed information by sector, in Spain as a whole retail provided the most new companies (23.1%), followed by construction (14.8%) and hospitality (10.8%). The sector that lost the most companies was also retail (20.8%), followed by construction (18.3%), and industry and energy (12.3%).
