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As Swedish small business leaders get old, the sector is at risk of total collapse with massive loss of jobs

Wednesday, 26 October 2011
Nearly half of top managers in Sweden's small and medium sized businesses today will be affected by ages defects in the next ten years. This is looking to kill some 700,000 jobs as there are currently no upcoming young people to take over from them.

“There are many older managers and they are getting older,” says Roland Kadefors, associate professor at the University of Gothenburg that carried out that study in an EU funded project  framework. He is part of a team of researchers at the University who took particular note at Västra Götaland and Norrbotten in a study aiming at examining the long term sustainability of Swedish small and medium size companies with respect of their management and job creation prospect and growth in the long terms.

In Karlsborg there will be more than a quarter, 25.4 percent of entrepreneurs between 60 and 64 years old. In Överkalix the figure is even higher, at 26.3.

“We are concerned about this,” says Mary Dern, regional manager for the Federation of small businesses in Västra Götaland (Goteborg).

Sweden has the oldest business managers in Europe, including small and medium enterprises
In which 25 percent of executives plan to retire within five years, 40 percent within ten.
This has to do with some 175,000 small businesses and it could affect some 700,000 jobs in the sector.

The risks of closure of these companies have been determined that it will lead to the fall of around ten percent, equivalent to 70,000 jobs.

“If no one is taking over the alternative is closure. Generation pass-over is very a critical issue,” said Professor Roland Kadefors at a seminar on Tuesday.

Sparsely populated, with low birth rates and emigration, has been accounted as some of the most leading factors according to Roland Kadefors who also point that it would be difficult to maintain public services in some places.

It is therefore vital that the re-growth among entrepreneurs is especially beneficial.
“It is not attractive for young people to enter into business as an entrepreneur, there are too few people take the plunge,” says Mary Dern, who can thinks of carrots in the form of risk reduction for those who dare and other tax benefits for entrepreneurs so that they take over from the older generation.

“This is worrying for Sweden as it is among the small and medium sized companies we have to get new jobs.”

This is not new story. Sweden has always ways been classified as being a leading and competitive countries in relations to business. This is more so on paper than on the ground. Running a small business in Sweden is almost not possible because any form of business in Sweden must have huge capital. There is also lots of controls and bottle necks, waste of time and costs.
For example a limited liability company employing two people has to pay lost of money to accountant and then bookers just to meet accounting procedures. The question asked is by should such a small company not deal with book-keeper only given that the accountant does literally no work here but to certify the accounting information.

The government respond by taking off the accountant for such small firm but this has to go through another bureaucratic process that will also be very costly. How many young people will want to go through such torment remains a puzzle. The system has to be made simple and easy.

This is why small businesses are not a very attractive option to young entrepreneurs and also to the government because it is small. Sweden is obsessed with the big businesses and these weaken the entrepreneur spirit of those who want to start a business.

There is also the issue of silent barrier of entre in some places where people with the required skills are not welcome. Oh yes! the immigrants who could be a boost to the business community are shied at and discouraged. These immigrants are institutionally discriminated upon for example banks are leaders in discouraging immigrant looking swedes by rejecting loans to them. As such they have no access to funding and tend to lay bare.

Although Sweden is some what diverse, authorities here tend to focus only on those set of people in the society they are interested in and leave out skilful people they are not interested in. 
By Scancomark.se Team

The proportion of employed workers 60-64 years within the small and medium size enterprises (companies with less that 250 employees):
Norrbotten County
Överkalix 26.3 percent,
Boden, 21.3,
Övertorneå 20.2.

Jokkmokk 14.0,
Haparanda 12.8,
Kiruna 11.2.
Western Sweden
Karlsborg 25.4,
Färgelanda 22.3,
Essunga  22.1.

Mölndal, 12.1,
Tidaholm 12.0,
Gothenburg 11.5.
Source: Department of Work Science at Gothenburg University

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