Federal Data Shows Large Companies Now Creating Most Jobs
According to Bureau of Labor Statistics data for the 10 years through December 2014, large employers created more jobs than small across the US. The Phoenix Business Journal reported that the data found companies with at least 250 employees “created 63 percent of the new jobs last year,” while “small firms generated 22 percent of the net job growth for 2014 and mid-market companies added a net 15 percent.” This job creation pattern “is a near flip-flop” from a decade ago when small businesses, defined as those with 50 or fewer employees, created 40% of new jobs. The Business Journal noted that part of this was because small and mid-sized companies “retained more jobs” during the recession than large companies. Since 2009 when the recession technically ended, those large firms have been hiring more workers for all quarters except two. Looking at Arizona specifically, data have followed this pattern of workforce expansion from existing companies doing hiring rather than new startups forming and hiring. In 2014 more than 7,600 companies hired across the state, while almost 5,300 companies ended employment contracts. Arizona Small Business Association CEO Rick Murray said of the overall data trends, “We know that our small business hiring has been slow over the last couple of years.” However, there is interest in increasing hiring for 2016. Murray said, “We do know, despite a lessening outlook for the economy, 60 percent of our members plan on adding jobs over the next year.”
What This Means For Small Business
Phoenix-area small business owners are seeking reassurance that their city’s economy is strong and that Phoenix remains a business-friendly place. News that small business hiring across the US, and in Arizona, has been sluggish following the recession is a troubling indicator that the city has a long road ahead in recovering from the recession and becoming a place that is supportive of the small business community.
NFIB recently noted data on Phoenix’s economy.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.