Academic journal article Monthly Labor Review

Small Firms' Employment Growth Twice That of Large Firms in 1983

Academic journal article Monthly Labor Review

Small Firms' Employment Growth Twice That of Large Firms in 1983

Article excerpt

Small businesses played a significant role in the 1983 recovery, according to the Small Business Administration's 1984 report of the President. In six major industries for which small- and large-dominated industries can be identified, small business employment growth of 2.6 percent was more than twice that of large business growth of 1.2 percent.

Small firms accounted for 6 percent of the growth in construction, 2 percent in retail trade, 6 percent in finance, insurance, and real estate, and 4 percent in services. Transportation, communication, and public utilities employment declined about .1 percent, and employment was u nchanged in wholesale trade. In constrast, employment in large business-dominated industries declined in all but the finance, insurance, and real estate (up 1.5 percent) and services (up 4 percent) industries.

According to the report, "Small businesses furnish 2 of 3 workers with their first jobs. Many of these first-time positions are in the service sector, the traditional doorway to the job market for the young, minority, and unskilled jobseeker."

Over the 1980-82 period, firms with fewer than 100 employees accounted for 43 percent of the net increase in jobs. Creation of new small businesses alone added 2 million jobs. …

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