Posted by John Irons at September 05, 2002 12:40 PM

Here's a data paradox to mull over...

< 20 employees

Firms with fewer than 20 people represented 18% of employment in 1999. [data]

Firms with fewer than 20 people were responsible for 53% of total net job creation in 1999. (From 1989 to 1999 this figure has ranged from 49% to over 75%) [data]

500+ employees

As of 1999, about 50% of all jobs are in firms with more than 500 employees. [data]

Of the jobs created, only 33% were in firms with more that 500 people. [data]

Puzzle:

Given these numbers, you'd expect the total employment share in firms with less than 20 people would have been growing over time, and the share of the 500+ group to decline. Right?

Wrong! The employment numbers show that percent of total employment for the <20 person firms has decreased from 21% to 18% from 1989 to 1999; and the total employment for the 500+ group has increased from 45% to 50%.

Any explanations? Comments welcome...

Sources:

Office of Advocacy - U.S. Small Business Administration - Firm size data provided by the U.S. Census Bureau

Here's the spreadsheet with data.