Switzerland is experiencing a remarkable surge in entrepreneurial activity, with more people than ever taking the leap into self-employment. According to the latest study, “National Analysis of Swiss Company Foundations Q1 to Q3 2024” by the IFJ Institute for Start-ups, a total of 39,166 new companies were registered in the Swiss Commercial Register during the first three quarters of 2024. This marks a significant increase of 2.2% compared to the same period in the record-breaking year of 2023.
The Swiss Labour Force Survey (SAKE) conducted by the Federal Statistical Office (BFS) underscores the importance of this development for the country’s economy. An impressive 14% of all employed individuals in Switzerland are now self-employed, highlighting a growing trend toward entrepreneurship and self-reliance.
A Record-Breaking Year in the Making
The data from January 1 to September 30, 2024, paints an optimistic picture. On average, 143 new companies were founded each day across Switzerland—a testament to the country’s robust entrepreneurial spirit. If this pace continues, 2024 is set to surpass the previous year’s record for new company foundations.
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Simon May, Co-Managing Director of IFJ, notes a significant trend toward part-time self-employment. “Many of our founders want to play it safe and start their own business alongside existing employment,” he says. This approach allows budding entrepreneurs to mitigate risk while exploring new business ventures.
Self-Employment: A Cornerstone of the Swiss Economy
The relevance of new company foundations extends beyond innovation and international competitiveness; it’s a crucial aspect of employment in Switzerland. With 14% of the workforce being self-employed—amounting to 679,000 people—self-employment is a significant contributor to the Swiss economy. Moreover, 8.2% of all employed individuals hold more than one job, further emphasizing the trend toward diversified income streams and part-time entrepreneurship.
Self-employment doesn’t just provide opportunities for the entrepreneurs themselves; it also creates additional jobs for employees, bolstering the overall job market. This dual impact makes the rise in new company foundations a vital component of Switzerland’s economic health.
Regional Growth Patterns
The IFJ’s national analysis reveals detailed insights into how company foundations have evolved across different regions:
- Southwestern Switzerland leads with a remarkable growth of +5.6%.
- The Zurich region follows closely with an increase of +2.0%.
- Other regions such as Espace Mittelland (+1.5%), Central Switzerland (+1.4%), Eastern Switzerland (+1.1%), and Ticino (+0.8%) also show positive growth.
- The Northwestern Switzerland region saw a slight decline of -0.5%.
Cantons Experiencing a Startup High
Eighteen cantons reported an increase in new company foundations during the first three quarters compared to the previous year:
- Appenzell Ausserrhoden: +15.3%
- Uri: +12.6%
- Appenzell Innerrhoden: +11.2%
- Vaud: +7.9%
- Valais: +7.0%
- Fribourg: +6.5%
- Glarus: +6.6%
- St. Gallen: +5.6%
- Zug: +3.8%
- Obwalden: +3.5%
- Schwyz: +2.3%
- Zurich: +2.0%
- Geneva: +1.9%
- Bern: +1.2%
- Neuchâtel: +1.1%
- Aargau: +0.8%
- Ticino: +0.8%
- Basel-Stadt: +0.6%
Areas with Reduced Growth
Some cantons experienced a slight decrease in new company formations:
- Graubünden: -0.9%
- Jura: -3.0%
- Nidwalden: -3.1%
- Solothurn: -2.5%
- Lucerne: -2.3%
- Basel-Landschaft: -4.7%
- Thurgau: -5.1%
- The most significant decline was in Schaffhausen: -15.9%
Preferred Legal Forms
When it comes to legal structures, the Limited Liability Company (GmbH) remains the most popular choice among new entrepreneurs in Switzerland. A total of 15,324 new GmbHs were registered during the first three quarters, marking a 1.6% increase from the previous year.
Interestingly, there has been a substantial rise in newly founded sole proprietorships (Einzelfirmen). With 13,674 new entries, this category saw a growth of 4.2% compared to the previous year. This surge aligns with the trend of individuals venturing into part-time self-employment.
On the other hand, there was a decline in the formation of partnerships (-4.4%) and corporations (-1.2%), indicating a shift in preference toward more flexible and individual-centric business models.
A Five-Year Perspective
Over the past five years, the average number of new companies registered between January 1 and September 30 was 37,183. The current year’s figure of 39,166 new foundations represents a 5.3% increase over this five-year average and a 2.2% rise compared to the same period last year. These statistics place 2024 firmly on track to set a new record in company formations.
The Driving Forces Behind the Boom
Several factors contribute to this entrepreneurial upswing:
- Economic Stability: Switzerland’s robust economy provides a fertile ground for new businesses.
- Government Support: Public sector initiatives and regional economic development programs encourage entrepreneurship. “Numerous cantons, economic regions, cities, and municipalities support founders. This additional motivation leads individuals to take the step toward their own company, bringing long-term growth at all levels,” says Simon May.
- Cultural Shift: There’s a growing cultural acceptance of entrepreneurship and self-employment as viable career paths.
- Part-Time Entrepreneurship: The rise in part-time self-employment allows individuals to test business ideas without relinquishing the security of steady employment.
The Importance of Self-Employment
Self-employment plays a critical role in Switzerland’s economy:
- Job Creation: New businesses not only provide employment for their founders but also create jobs for others.
- Innovation: Start-ups often drive innovation, contributing to Switzerland’s competitiveness on the global stage.
- Economic Diversification: A diverse range of small and medium-sized enterprises (SMEs) strengthens the economy by reducing reliance on large corporations.
Looking Ahead
Simon May remains optimistic about the future: “This year once again impressively shows that Switzerland is a sustainably good location for starting one’s own company. The positive development in the number of new company foundations in the first nine months is very gratifying for the business location of Switzerland.”
All indicators suggest that the trend will continue, potentially breaking previous records by the end of the year. The rise in new company formations, especially among sole proprietorships, signifies a robust entrepreneurial ecosystem.
Conclusion
Switzerland’s entrepreneurial landscape is thriving, bolstered by economic stability, supportive policies, and a cultural shift toward self-employment. The increase in new company foundations not only reflects individual ambition but also contributes to the country’s overall economic health.
As more individuals embrace entrepreneurship—whether full-time or alongside existing employment—Switzerland solidifies its position as a global leader in fostering innovation and supporting new business ventures. With the current momentum, 2024 is poised to be a landmark year for Swiss entrepreneurship.
