Abstract
Considerable controversy has surrounded the early findings of David Birch that small businesses create at least a majority of all new jobs in the United States. Compounding the controversy has been Birch himself who has disavowed his earlier conclusion. This article reexamines the issue of contribution of various size business establishments to job growth using a better dataset, a modified definition of a "small business, " and an ability to track the job-generating contributions of various size establishments across segments of the business cycle, across industry sectors and specific industries, and across differing geographic locations. In addition the article examines the role of using gross versus net job generation as the measure of job generation contribution. The article concludes that the role of establishment size varies by definition, time period, industry, and location.
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