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Small and large firms and job growth

June 26, 2007

Who creates the most jobs: small businesses or large businesses? This subject has been widely discussed among economists and researchers and is often a topic of political debates citing the important role of small businesses in creating jobs.

Percent of net employment growth by size of firms, second quarter 1990-third quarter 2005 (seasonally adjusted)
[Chart data—TXT]

New statistics from the BLS Business Employment Dynamics program provide data with which to analyze many of the size class methodological issues, and are a valuable data resource with which to answer these questions.

The following findings result from analysis of BLS firm size class data:

These data are from the Business Employment Dynamics program. Data presented here are for workers in private industry covered by State unemployment insurance programs. A firm is defined as an aggregation of establishments under common ownership by a corporate parent. An establishment is defined as an economic unit that produces goods or services, usually at a single physical location, and engages in one, or predominantly one, activity. Find out more in "Employment dynamics: small and large firms over the business cycle," by Jessica Helfand, Akbar Sadeghi, and David Talan, Monthly Labor Review, March 2007.

SUGGESTED CITATION

Bureau of Labor Statistics, U.S. Department of Labor, The Editor's Desk, Small and large firms and job growth on the Internet at http://www.bls.gov/opub/ted/2007/jun/wk4/art02.htm (visited April 17, 2014).

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