Eastern Switzerland leads in new companies
St.Gallen – A record number of companies were founded in Switzerland last year. Cantons in Eastern Switzerland played a leading role. The number of new IT companies was particularly high in these regions.
In 2019, a total of 44,482 new companies were founded in Switzerland, announced the St.Gallen-based Institut für Jungunternehmen (IFJ). This equates to an increase of 3 per cent year-on-year, according to the startups institute. In Eastern Switzerland, there was a surge of 7 per cent in new companies. Appenzell Innerrhoden (+14 per cent), Glarus (+13 per cent) and St.Gallen (+11 per cent) enjoyed the highest growth rates of all Swiss cantons. Behind Bern (+10 per cent) came Thurgau (+8 per cent) and Graubünden (+7 per cent). In absolute numbers, St.Gallen came just ahead of Thurgau (1,201) among the Eastern Swiss cantons with 2,297 new companies.
There are several reasons behind the record results, explained IFJ Head Simon May in an article in “Tagblatt”. Firstly, Switzerland’s cantons have improved the support available to startups. Although “support does not produce an immediate effect, it is paying off today”, according to May.
The startup forums Olma and Rhema have also contributed to the strong growth in new companies in Eastern Switzerland, he continued. In this part of the country, the information technology sector has seen particular growth. The number of new companies in IT and ICT in Eastern Switzerland rose by 56 per cent – “more than twice as quickly as the Swiss average”, writes “Tagblatt”. “Despite this, traditional sectors in Eastern Switzerland, such as trade, gastronomy and retail, made up a larger proportion of new companies than average”, continues the newspaper.
That limited companies and sole traders are becoming the more popular legal entities shows that most of the new companies are small-scale entrepreneurs. Such companies tend to set up in their local region, which is why tax issues are not as important now as they were five years ago, according to May. Even though most of the new companies are small, the strong growth is positive for Eastern Switzerland: “Just under 10 per cent of all employees in Switzerland work at companies younger than 10 years.”