The pace of recovery in hiring and job creation since 2008 is stronger in newer firms (two years or younger) than in more established companies, according to Job Creation, Worker Churning, and Wages at Young Businesses, a report by the Ewing Marion Kauffman Foundation. Despite elevated worker turnover rates, the percentage of hiring based on job creation is much greater at start-ups than at more mature firms.
- Four out of every 10 hires at young firms are in newly created jobs.
- At older firms, the ratio fluctuates between 0.25 and 0.33.
- Post-recession, only start-ups show recovery in the pace of worker churning, which is critical to maximize allocating employees to jobs and boost wage growth over workers’ careers.
Source: Kauffman Foundation, November 28, 2012.