Evidence from Manufacturing Industry in Iran During The Second Development Plan

It is argued that Small and Medium-sized Enterprises (SMEs) play an important role in job generation. However, recent studies,in developed countries show that only a few SMEs has achieved high growth and created the most of the jobs. This paper aims to find the role of high growth SMEs in job generation in Iran during the Second Development Plan in1995-99. We use a large sample of manufacturing SMEs, for those with less than 50 employees. We measure growth of SMEs by absolute, comparative and Birch IndicesWe find that only 10 percent of manufacturing SMEs show rapid growth, but they are responsible for more that 50 percent of total jobs created after four years.