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We take a look at the total income earned by firm size per industry based on the latest quarterly financial statistics results released by Statistics South Africa. Just how much are smaller firms contributing to total income earned on various industries of South Africa's economy?
Are SMME's contributing meaningfully or is business in South Africa dominated by larger firms? |
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So which industries dominate income earned in the South African economy?
In this article we will focus in the income earned by the following major industries in South Africa:
The bar chart below shows the income earned for the 4th quarter of 2018 per industry per firm size.
- Mining and quarrying
- Manufacturing
- Construction
- Trade (includes retail, wholesale and motor trade)
- Transport
- Real estate and other business services
The bar chart below shows the income earned for the 4th quarter of 2018 per industry per firm size.
The summary below shows the total income earned (all firm sizes) per industry in the graphic above:
So the Trade industry earned the most, with the manufacturing a relatively close second. And the Real estate and business services industry a distant 3rd position. The summary below shows the percentage contribution of the various firms to total income earned by the selected industries
So lets focus on the contribution of the various firm sizes to overall income earned. Just how much is smaller firms contributing to the total income earned by companies in South Africa?
So 62.32% of all income earned by these industries is earned by firms that are classified as being large, 27.95% of total income earned in these industries is earned by firms classified as small and only 9.73% earned by firms seen as medium. The medium sized firms might be seen as the missing middle. Larger firms have greater buying power and more financial muscle to grow, and current government policies are set up to favour smaller companies, leaving middle sized firms stuck in the middle.
Within specific industries, smaller firms contributes the most to the total income earned by the Real estate and business services industry, with smaller companies making up 48.9% of the income earned in this industry. Smaller firms also contributes significantly to total income earned in the Trade industry with it making up 36.4% of total income earned in the Trade industry as at the 4th quarter of 2018
- Trade: R 895 279 000 000
- Manufacturing: R 817 252 000 000
- Real estate and other business services: R 319 967 000 000
- Transport:: R 253 556 000 000
- Mining and quarrying: R 194 245 000 000
- Construction: R 93 386 000 000
So the Trade industry earned the most, with the manufacturing a relatively close second. And the Real estate and business services industry a distant 3rd position. The summary below shows the percentage contribution of the various firms to total income earned by the selected industries
- Trade: 34.79%
- Manufacturing: 31.75%
- Real estate and other business services: 12.43%
- Transport: 9.85%
- Mining and quarrying: 7.55%
- Construction: 3.63%
So lets focus on the contribution of the various firm sizes to overall income earned. Just how much is smaller firms contributing to the total income earned by companies in South Africa?
- Large: 62.32%
- Medium: 9.73%
- Small: 27.95%
So 62.32% of all income earned by these industries is earned by firms that are classified as being large, 27.95% of total income earned in these industries is earned by firms classified as small and only 9.73% earned by firms seen as medium. The medium sized firms might be seen as the missing middle. Larger firms have greater buying power and more financial muscle to grow, and current government policies are set up to favour smaller companies, leaving middle sized firms stuck in the middle.
Within specific industries, smaller firms contributes the most to the total income earned by the Real estate and business services industry, with smaller companies making up 48.9% of the income earned in this industry. Smaller firms also contributes significantly to total income earned in the Trade industry with it making up 36.4% of total income earned in the Trade industry as at the 4th quarter of 2018