Small biz

[Doug Henwood <dhenwood@xxxxxxxxx>]

PEN-Lers might be interested in a new study from the US Bureau of the
Census calls the entire small biz mythology into serious question. It
makes many points, among them that while SB does create jobs, it destroys
them like crazy as well, so that the net effect is little different from
large biz. (The study focuses on jobs - but I think employment and capital
accumulation generally move together in this instance.) Another point:
many of the studies that show small biz creating jobs are confounded by
the fact that as medium- and big-businesses shrink they suddenly fall into
the small biz category, inflating the total. Therefore, job loss becomes
job gain!

The full reference on the Census study is Gross Job Flows in US
Manufacturing, by Steven J. Davis, John Haltiwanger, and Scott Schuh. A
summary is available on Cendata - and is probably available on the Census
gopher (census.gov).

Doug

Doug Henwood [dhenwood@xxxxxxxxx]
Left Business Observer
212-874-4020 (voice)
212-874-3137 (fax)