Most Workers are Employed by Large Firms
Jared Bernstein posts an interesting graph showing the distribution of employees by firm size:
The graph shows that although just under half of all businesses have four employees or less, they account for a small fraction of overall employment. In fact, around half of all workers are employed at firms with 500 or more workers on the payroll (just over 15% of all firms). What does this mean? As Jared says:
Nor is it the case that small businesses, per se, are the engine of job growth their advocates claim. Research like this finds that "once we control for firm age there is no systematic relationship between firm size and [job] growth." As I stress here, that research shows that it's surviving startups that are particularly important in terms of generating new jobs.As we look for ways to create jobs, we should have the correct picture of where jobs are and how jobs are usually created.