Mitt Romney stepped in it last night when he said at a fundraiser that, “Big business is doing fine in many places.” For a candidate whose campaign is premised on the idea that Obama has left the economy in shambles, that’s sort of off-message.
But it isn’t wrong. The Business Employment Dynamics division of the Bureau of Labor Statistics breaks down job gains and losses by business size. Those numbers suggest that big businesses are hiring at a faster rate than small businesses, and were hit much less by the recession. BLS breaks job gains and losses into categories of 1-4 employees, 5-9 employees, 10-19, 20-49, 50-99, 100-249, 250-499, 500-999, and over a thousand. Here’s how the categories break down in terms of net job gains/losses from January 2008. The darkest line is the 1000+ employees category, and the lightest one is the 1-4 employees category:
The 1-4 employees category is the light one with a really steep (over 4 percent) drop in employment the first quarter of 2009. The dark black line that fares best that quarter, with a decline of only 1.6 percent, is companies with over 1000 employees.
Same story with corporate profit. The Bureau of Economic Analysis keeps data on general corporate profits while the National Federation of Independent Businesses, a right-leaning trade group, keeps data (pdf) on the percent of small businesses reporting profits minus the percent reporting losses. You can’t make an apples and oranges comparison between those, but you can compare the trends in each. Here’s how each has changed from January 2008:
Corporate profits have rebounded much more quickly than small business earnings, which are only just getting back to their pre-crisis point. So while Romney’s comment wasn’t politic, he had a point. Big business is doing a great deal better than mom and pop operations.