The role of employer size in wage determination : distinguishing between the workplace and the company

Abstract

In recent years there has been increasing interest in the role of small business in the economy and in the labour market. The thesis asks a number of key questions about the role of both workplace size and company size as determinants of individual wages. Is current research on individual wage determination compromised by ignoring variation by employer size? Do both workplace size and company size influence wages? Findings suggest that the process of wage determination is quite different between the Small Business sector, an Extensive sector with small workplaces operated by large companies and an Intensive sector with large workplaces. In part higher wages in large workplaces are associated with the structure of product markets as well as tenure with the current employer. Within the Small Business sector low income groups are more disadvantaged than their counterparts in large companies and/or workplaces.