Small Business Employment in the Pandemic Era and Beyond

Kristin F. Butcher, Anne Fournier, Luojia Hu and Diego Jimenez-Hernandez ()
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Anne Fournier: https://www.chicagofed.org/people/f/fournier-anne
Diego Jimenez-Hernandez: https://www.chicagofed.org/people/j/jimenez-hernandez-diego

Chicago Fed Letter, 2025, vol. 509, 10

Abstract: In this article, we study the creation of small firms, with a focus on the post-March 2020 period (i.e., after the start of the global Covid-19 pandemic).1 We document the increase in new small firms, as well as the contributions of small firms to employment growth, during this period. Our analysis shows that, despite the increase in the number of small businesses, the share of employees working for small firms is considerably lower than in large businesses and is, in fact, declining.

Keywords: small firms; employment growth; post-pandemic; Business formation; business dynamism; Firm performance; Labor demand; Business fluctuations (search for similar items in EconPapers)
JEL-codes: E32 J23 L25 M13 (search for similar items in EconPapers)
Date: 2025
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