High-Growth Firms and Employment

This STI Working Paper deals with this group of rapidly expanding firms. It does so by placing the discussion into a context of entrepreneurship, arguing that there are two main aspects to this notion: one of business start-ups and market entry, and another one of innovation. Evidence is based on results from five OECD countries (Germany, Italy, Netherlands, Spain and Sweden) as well as from Quebec (Canada). Each of these studies used a firm-level data set to identify high-growth firms and their differentiating characteristics. High-growth firms are those firms that rank first according to a measure that combines relative (percentage) and absolute rates of employment expansion. Despite considerable differences in the underlying data and some of the methodologies, number of common findings emerge: High-growth firms account for a disproportionately large part of gross jobs gained. Small firms exhibit higher net job creation rates than large firms do. At the same time, significant flows ...