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Job Creation, Job Destruction and the Contribution of Small Businesses: Evidence for UK Manufacturing

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Author Info

  • Matthew Barnes

    (Queen Mary, University of London)

  • Jonathan Haskel

    (Queen Mary, University of London)

Abstract

We use the ARD micro level data set for UK manufacturing to document job creation and job destruction (JC&D). Due to data limitations, previous UK studies were unable to use entry and exit in calculations of JC&D and/or were are at the firm rather than establishment/plant level and/or used data that understate the number of small businesses in the economy. Our data can overcome these problems being based on plant and establishment-level data from the UK Census of Production. We compute JC&D levels and rates and the contribution of small businesses for UK manufacturing between 1980 and 1991 and compare our findings with previous UK studies and other countries. We find: a) establishment (plant) job creation and destruction rates of 10.0% and 13.5% (11.2% and 14.7%) respectively, higher than other studies; b) large establishments (plants) are responsible for about 60% (55%) of job destruction; and c) small establishments (plants) are responsible for between 50% and 68% (57% and 70%) of job creation, depending on calculation method.

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Bibliographic Info

Paper provided by Queen Mary, University of London, School of Economics and Finance in its series Working Papers with number 461.

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Date of creation: Jun 2002
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Handle: RePEc:qmw:qmwecw:wp461

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Keywords: Small firms; Job creation and destruction;

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  1. Richard Disney & Jonathan Haskel & Ylva Heden, 2003. "Restructuring and productivity growth in uk manufacturing," Economic Journal, Royal Economic Society, vol. 113(489), pages 666-694, 07.
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Blog mentions

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  1. Job insecurity: what's the problem?
    by chris dillow in Stumbling and Mumbling on 2008-08-31 12:43:39
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Cited by:
  1. Brixy, Udo & Kohaut, Susanne & Schnabel, Claus, 2004. "How fast do newly founded firms mature? Empirical analyses on job quality in start-ups," Discussion Papers 30, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  2. Elena Cefis & Roberto Gabriele, 2005. "Does Spatial Disaggregation Matter in Job Creation and Destruction Flows?," LEM Papers Series 2005/09, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  3. Marco Corsino & Roberto Gabriele & Sandro Trento, 2010. "Job flows in Italian SMEs: a longitudinal analysis of growth, size and age," DISA Working Papers 1008, Department of Computer and Management Sciences, University of Trento, Italy, revised 22 Dec 2010.
  4. Alejandro Micco & Carmen Pagés-Serra, 2004. "Employment Protection and Gross Job Flows: A Differences-in-Differences Approach," Research Department Publications 4365, Inter-American Development Bank, Research Department.
  5. Schnabel, Claus & Kohaut, Susanne & Brixy, Udo, 2008. "Employment stability of entrants in newly founded firms : a matching approach using linked employer-employee data from Germany," IAB Discussion Paper 200809, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  6. Brons, Lajos, 2004. "On the Ontology of Events in Demographies of Organizations," MPRA Paper 1610, University Library of Munich, Germany, revised 2006.
  7. Sasan Bakhtiari, 2012. "Small Business Redefined: A Quasi-Linear Fuzzy Classification of Firm Size," Discussion Papers 2012-24, School of Economics, The University of New South Wales.
  8. David Neumark & Brandon Wall & Junfu Zhang, 2008. "Do Small Businesses Create More Jobs? New Evidence from the National Establishment Time Series," NBER Working Papers 13818, National Bureau of Economic Research, Inc.
  9. Carmen Pagés-Serra & Alejandro Micco, 2008. "The Economic Effects of Employment Protection: Evidence from International Industry-Level Data," Research Department Publications 4496, Inter-American Development Bank, Research Department.
  10. Alejandro Micco - Carmen Pages, 2004. "Employment Protection and Gross Job Flows1," Econometric Society 2004 Latin American Meetings 295, Econometric Society.
  11. Heckmann, Markus & Schnabel, Claus, 2005. "Überleben und Beschäftigungsentwicklung neu gegründeter Betriebe," Discussion Papers 39, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  12. Carmen Pagés-Serra & Alejandro Micco, 2008. "Efectos económicos de la protección del empleo: Elementos de juicio a partir de datos internacionales a nivel de actividad económica," Research Department Publications 4497, Inter-American Development Bank, Research Department.
  13. Alejandro Micco & Carmen Pagés-Serra, 2004. "Protección del empleo y flujo bruto de puestos de trabajo: un enfoque de diferencias en diferencias," Research Department Publications 4366, Inter-American Development Bank, Research Department.

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