Thursday, April 8, 2010

Young businesses, not small businesses

Despite the claims that small businesses are prolific job creators, they are just so-so in this regard. Rather, it is young businesses that are the real job growth engine. Recent work by economists John Haltiwanger, Ron Jarmin, and Javier Miranda shows that a 25-year-old small business is likely to shed jobs, not create them. Among firms under 5 years old, job creation is driven by the smallest firms.
--Josh Lerner, Boston Globe, on the myth of the small business

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