Small firms, however, provide more training to new employees with less than 12 years of schooling, and a comparable amount of training to new hires with no previous work experience. Compared with firms with 500 or more employees, firms with fewer than 25 employees provide more than twice as many hours of informal management training to employees with less than a high school diploma. These results are consistent with earlier findings that small businesses hire less educated and inexperienced more workers and provide them with general skills and training. The amount of training provided to less educated and more inexperienced workers does not increase with firm size because larger firms appear to prefer hiring and providing firm-specific training to more experienced and educated workers. Although small firms provide less training, on average, to new hires, the payoffs that workers receive are greater in small firms.
Wages grow faster in the first two years of employment in small firms than in large firms.
Wages per hour of training in the first two years of employment grow 2.5 times faster in firms with fewer than 100 employees than in firms with 100 or more employees. Formal training is more costly than informal training across all firm size categories. About 90 percent of all new hires receive informal training from managers and supervisors, regardless of the size of firm. The importance of basic skills, such as showing up on time, the ability to work with others, reading, oral communication, following directions, and general problem-solving abilities, are applicable across all firm sizes. Math and writing skills are applicable to approximately 90 percent of all businesses.