NCPA - National Center for Policy Analysis

Workforce Now Equally Divided Between Big and Small Employers

March 19, 2002

At some point in the year 2000, the proportion of workers employed by large companies -- those having 500 or more workers -- probably passed the 50 percent mark, according to Small Business Administration data.

  • In 1999, big companies employed 49.7 percent of the 111 million U.S. workers -- up from 45.5 percent in 1988.
  • Experts say the shift toward big companies probably will continue as the U.S. economy matures and consolidates.
  • About 82 percent of big employers offer health insurance compared to 68 percent of small firms -- meaning that a greater number of U.S. workers will be covered.
  • Also, 79 percent of employees at big firms have retirement plans compared to 46 percent of those at small ones, according to the Employee Benefit Research Institute.

Experts also say, however, that workers at big companies are more removed from top management, which could mean higher turnover -- leading to lower productivity.

Analysts say employment figures could see-saw back in favor of small firms when figures for 2001 are released. That's because corporate giants shed a record 2 million jobs that year -- and small businesses still create 75 percent of new U.S. jobs.

About 89 percent of the nation's 5.6 million employers have fewer than 20 workers.

Source: Jim Hopkins, "Workforce Shifts to Big Companies," USA Today, March 19, 2002.

For text


Browse more articles on Economic Issues