[ixnu]

Do you have any evidence to support this? The data that I can find point to a more subtle conclusion that does not fit this oft-repeated statement (myth?).

"We find that the relationship between firm size and employment growth is sensitive to these issues. However, our main finding is that once we control for firm age there is no systematic relationship between firm size and growth."

http://econweb.umd.edu/~haltiwan/size_age_paper_R&R_Aug_16_2...

EDIT:

I should say that it's not that small businesses don't create jobs, it's just a particular type of small business (young ones) that create most of them.

Additional discussion - http://www.richmondfed.org/publications/research/econ_focus/...

[Retric]

Your missing the point it's not a question of size it's a question of profitability.

There is a popular idea that reducing taxes on profits would spurn significant job growth. However doing so in no way changes the math on how many job's maximize profits. Further, profitable company's that higher people temporarily reduce there profitability which directly reduces their tax burden and has the same effect cheaply and automatically. Also, profitable company's can borrow money to assist growth so if you look at things from an accounting perspective removing all taxes on profits has a tiny impact on how fast a company can grow.

Note, there are ways to change the tax structure to actually promote job growth in the short term. Such as a reduction in payroll taxes for company's that employ more people now than they did at any time in the last 5 years. However, none of them change the long term math on what the ideal number of employees for a stable company is.

[ixnu]

The implication (point?) of the research is that older companies (regardless of size) create fewer jobs relative to younger companies.

I would disagree with the statement that reducing taxes on profits has absolutely no impact on overall job growth. Furthermore, a reasonable conclusion would be that reducing taxes on young (and almost by definition, small) companies independent of profitability would have a greater beneficial impact on job growth than reducing taxes on highly profitable and older firms (large or small).

Based on the research, maybe the best course of action for job growth would be to reduce all taxes (profitability and payroll) for young companies regardless of size and profitability rather than an indiscriminate scheme that reduces payroll taxes based on time constraints (such as 5 years of expanding employees) for all firms large and small.