Does size matter? The influence of firm size on working conditions and job satisfaction

Abstract

Using a Spanish survey, this paper investigates the relationship between firm size and
working conditions, and whether firm size differences in workers’ job satisfaction can
be accounted for by differences in their work environment. The results indicate that: (1)
workers in larger firms have a significantly lower level of autonomy and, in general,
face worse working conditions; (2) working in large firms has no statistically significant
effect on job satisfaction after controlling for working conditions; and (3) no systematic
differences exist in worker mobility across firm-size categories. We conclude that
observed wage differentials by firm size are utility-equalizing, so they are due to
differences in working conditions.