Description:
This indicator measures the total early-stage entrepreneurial activity (TEA) rate. The TEA rate measures the proportion of the adult working age population that is actively trying to start a business, or that own and manage a business that is less than three and a half years old. The TEA rate is therefore the sum of the nascent entrepreneurship rate and the new business owner-manager rate - without double counting.
In order to improve the usefulness of this indicator for making policy decisions, the TEA rate is measured as a 3 year rolling average. Thresholds for performance changes are taken as +/- 1.0 percentage point.
Source of Data:
The data for this indicator are gathered through the Global Entrepreneurship Monitor (GEM) Scotland Monitoring Report. It is produced by GEM Consortium and GEM UK team: Aston Business School, and University of Strathclyde Business School. The report data vendor is BMG Research Ltd. The report is currently published on the GEM website.
Definitions:
The “adult working age population” is defined as those aged between 18-64.
The Global Entrepreneurship Monitor examines individual entrepreneurs at three key stages:
- “Nascent entrepreneurs”: The stage at which individuals begin to commit resources, such as time or money, to starting a business. To qualify as a nascent entrepreneur, the business must not have been paying wages for more than three months.
- “New business owner-managers”: Those whose business has been paying income, such as salaries or drawings, for more than three, but not more than forty two months.
- “Established business owner-managers”: Those whose business has been paying income, such as salaries or drawings, for more than forty-two months.
Total-early stage entrepreneurship combines the first two stages of active business development – the nascent entrepreneur stage and the new business owner-manager stage.
Criteria for Change:
This evaluation is based on: any difference within +/- 1.0 percentage points of last year's figure suggests that the position is more likely to be maintaining than showing any change. An increase of 1.0 percentage points or more suggests the position is improving; whereas an decrease of 1.0 percentage points or more suggests the position is worsening.
A guide for the general methodology of indicators can be found here: https://www2.gov.scot/About/Performance/scotPerforms/NPFChanges/Methodology