Seeking An Empirical Development Taxonomy For Manufacturing SMEs Using Data From Australia’s Business Longitudinal Survey

Abstract

This paper reports on the pilot stage of a proposed research effort to derive, characterise and employ an empirically-based development taxonomy for small and medium-sized enterprises (SMEs) in the manufacturing sector using panel data recently made available from Australia’s Business Longitudinal Survey. Cluster analysis is used with key enterprise size, age and growth variables to discover if there appear to be any stable development pathways evident in the data. Each of three annual data collections is separately examined, and then comparisons are made of the resulting cluster analysis outcomes over time. Descriptive statistics for various enterprise characteristics facilitate initial interpretation of the cluster analysis solutions. The findings match those of a prior taxonomic study reasonably well; and they provide general support for a stage-wise SME development pattern. Certain development pathways -subsistence, capped growth and continued growth in particular - seem to be stable and persistent.