Business Growth and Industrial Relations and HRM Practices: A
Longitudinal Study of Australian Manufacturing SMEs
Ms Janice Jones
Lecturer, School of Commerce,
The Flinders University of South Australia,
GPO Box 2100, Adelaide South Australia 5001.
Telephone: +61 8 82012707
Facsimile: +61 8 82012644
Email: Janice.Jones@flinders.edu.au
School of Commerce
Research Paper Series: 01-6
ISSN: 1441-3906
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Business Growth and Industrial Relations and HRM Practices: A Longitudinal Study of
Australian Manufacturing SMEs
ABSTRACT
The principal objective in this paper is to examine possible connections between small
and medium-sized enterprise growth and industrial relations and human resource
management practices for a longitudinal sample of 871 small and medium-sized
enterprises in the Australian manufacturing sector that have embarked upon different
growth development pathways. Statistical analysis reveals highly significant differences
in industrial relations variables, training, health and safety processes and patterns of
employment across the low, moderate and high growth small and medium-sized
enterprise development pathways. Furthermore, union membership, number of unions,
registered agreements, individual contracts, training, full-time managers and
employees, and numerical flexibility are significant and/or consistent concomitants
with small and medium-sized enterprise growth.
Keywords: small and medium-sized enterprises, industrial relations, human resource
management practices; business growth
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INTRODUCTION
The industrial relations and human resource management (HRM) practices of small and
medium-sized enterprises (SMEs) have received little specific attention from researchers in
Australia. As in many other areas of scholarly inquiry into business activity, empirical
research in this field has tended to focus upon larger concerns (e.g., Kramar 1999; Fisher and
Dowling 1999; Kitay and Lansbury 1997; Morehead et al. 1997). In the case of the Australian
manufacturing sector, over 99 per cent of all businesses are SMEs according to generally
accepted definitions (ABS 1996). This fact, together with the key role that manufacturing
inevitably plays in economic prosperity, strongly suggests the importance of increasing our
understanding of the management of human resources in manufacturing SMEs in Australia.
Given recent government policy regarding the identification and encouragement of high
growth SMEs, a particularly important gap in the extant literature is any reliable evidence
concerning possible linkages between business growth and industrial relations and HRM
practices employed. Moreover, for cost and other reasons, prior research in this field has most
often been cross-sectional in nature and has tended to employ comparatively small samples.
The recent availability of data from Australia’s Business Longitudinal Survey (BLS) provides
a promising new opportunity to take up the challenges so identified.
This paper builds upon a study previously undertaken by McMahon (forthcoming) as
part of an on-going research effort to derive, characterise and employ an empirically-based
development taxonomy for SMEs operating as proprietary companies in the manufacturing
sector, using panel data now available from the BLS. The principal objective in this paper is
to examine possible connections between SME growth and industrial relations and HRM
practices for a longitudinal sample of 871 SMEs in the Australian manufacturing sector that
have embarked upon different development pathways; and. The paper proceeds as follows.
After briefly outlining the key findings of McMahon’s (forthcoming) study, and of some
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prior research on the relationship between industrial relations and HRM practices and
organisational performance, the current research method is outlined. Thereafter, the findings
of the research are presented, followed by conclusions arising from this investigation.
PRIOR RESEARCH
Manufacturing SME Growth
In McMahon’s (forthcoming) research, exploratory cluster analysis was used with key
enterprise age, size and growth variables to discover if there appear to be any stable
development pathways evident in the BLS panel data. Each of four annual data collections
for the on-going longitudinal panel of 871 manufacturing SMEs was separately examined
using cluster analysis. Comparisons were then made of cluster analysis outcomes over time.
Using the clusters as markers or signposts, three relatively stable SME development
pathways were discernible in the longitudinal panel results – low, moderate and high growth.
The low growth development pathway appears to account for approximately 70 per cent of
SMEs in the panel. The moderate growth pathway seems to be followed by roughly 25 per
cent of the panel. And around 5 per cent of the panel look to lie on the high growth pathway,
which is in accord with the observed rarity of substantial growth amongst SMEs world-wide
(McMahon et al. 1993). Differences between the identified SME development pathways in
terms of enterprise age, size and growth variables are highly significant in a statistical sense,
thus underpinning confidence in the development taxonomy.
It would appear that the development pathways and the pace of SME development
(over 20 years or so) in the McMahon (forthcoming) study match reasonably well with those
in earlier research of a similar nature undertaken by Hanks et al. (1993). Both development
models seem to lead towards the same range of SME configurations that are widely
recognised in the relevant research literature (McMahon et al. 1993):
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 Traditional SMEs – following the low growth development pathway, these concerns
generally have few, if any, growth aspirations. They principally exist to provide their
owner-managers with a source of employment and income. Furthermore, they are
frequently operated in a manner consistent with the life-style aspirations of their ownermanagers. The McMahon (forthcoming) study suggests that after approximately 15
years such SMEs would have fewer than 20 employees, sales less than $3 million per
annum, total assets below $2 million, little or no employment growth, and sales growth
up to 5 per cent per annum.
 Capped growth SMEs – following the moderate growth development pathway, these
concerns generally have modest growth aspirations. Bounds to growth could be
externally imposed by the nature of their competitive environment; or may be intrinsic
given the nature of their operations. Frequently though, growth is deliberately capped
by owner-managers to a rate that limits dependence upon external financing – thus
minimising surrender of control and accountability obligations this support would
normally bring. The McMahon (forthcoming) study suggests that after approximately
15 years such SMEs would have fewer than 100 employees, sales around $10 million
per annum, total assets less than $10 million, employment growth up to 3 per cent per
annum, and sales growth as much as 10 per cent per annum.
 Entrepreneurial SMEs – following the high growth development pathway, these
concerns generally have ambitious growth aspirations. They are most often associated
with entrepreneurial aptitude, international outlook, technical and commercial
innovation, and other business qualities that could see them eventually become large
enterprises. The McMahon (forthcoming) study suggests that after approximately 15
years such SMEs would have over 100 employees, sales around $30 million per annum,
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total assets more than $20 million, employment growth exceeding 5 per cent per
annum, and sales growth greater than 10 per cent per annum.
The fact that these common SME configurations are recognised in the research lends further
plausibility to the empirically-based development taxonomy derived.
HRM Practices and Organisational Performance
Following a review of the conceptual literature on HRM practices and firm
performance, Huselid (1995) concluded that employee behaviour within firms has important
implications for organisational performance - namely, HRM practices can affect individual
employee performance through their influence over employees’ skills and motivation and
through organisational structures that enable employees to improve how their jobs are
performed. However Kitay (1997) argues that much of the extant HRM literature is
prescriptive, rather than analytical, and tends to describe what managers should be doing –
often based on unproven assumptions about the relationship between HRM practices and
organisational performance. Moreover, propositions about the relationship between HRM
practices and organisational performance lack solid empirical foundations (Kitay 1997).
Huselid (1995) reviewed prior empirical work examining the link between HRM
practices and organisational performance, and suggested that high performance work
practices such as extensive recruitment, selection and training; formal information sharing;
attitude assessment; job design; grievance procedures and labour-management participation
programs; as well as performance appraisal and merit based promotion and incentive
compensation systems enhances firm performance.
Deery et al. (1997) also argue that there is a considerable body of research evidence
indicating that certain innovative HRM practices can increase employee effort and positively
affect organisational performance. Green and McIntosh (1998) concluded that employees are
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motivated to supply effort where individual performance related pay schemes are used and
upward communication channels exist between workers and management. Furthermore,
union presence is more likely to have a positive influence on employee effort, when
accompanied by cooperative employee relations and high-trust, progressive HRM techniques
(Green and McIntosh 1998). Innovative HRM practices include extensive training, employee
participation, less rigid work design, and decentralising managerial tasks (Ichniowki et al.
1996). A number of econometric studies (Huselid 1995; Ichniowski et al. 1997; MacDuffie
1995) tentatively show a variety of factors including employee selection, high levels of
investment in training, and extensive involvement of employees in decision-making are
associated with high levels of performance (e.g., lower employee turnover, greater
productivity and corporate financial performance).
Kitay (1997) notes that, while there is no agreement on which HRM practices should be
studied, there is an emerging consensus that single practices on there own have relatively
little effect upon performance. Instead, businesses are more likely to benefit from improved
performance when consistent ‘bundles’ of selected HRM practices are implemented.
However, identifying which bundle of practices is most likely to be effective is difficult, as is
generalising from high-performance workplace studies.
Against this background, this paper has the potential to make a useful contribution to
Australian industrial relations and HRM research in the following respects. First, the paper
focuses wholly upon industrial relations and HRM practices amongst SMEs that have tended
to be neglected by other researchers. Second, the key policy issue of concomitants with
business growth amongst SMEs is explicitly considered. Finally, the research described in the
paper employs a relatively large and representative longitudinal panel sample of SMEs from
the Australian manufacturing sector - a technique seldom employed in Australian HRM
research (Kitay 1997).
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METHOD
The panel data employed in this research are drawn from the Business Longitudinal Survey
(BLS) conducted by the Australian Bureau of Statistics (ABS) on behalf of the federal
government over the four financial years 1994-95 to 1997-98. Costing in excess of $4
million, the BLS was designed to provide information on the growth and performance of
Australian employing businesses, and to identify selected economic and structural
characteristics of these businesses.
The ABS Business Register was used as the population frame for the survey, with
approximately 13,000 business units being selected for inclusion in the 1994-95 mailing of
questionnaires. For the 1995-96 survey, a sub-sample of the original selections for 1994-95
was chosen, and this was supplemented with a sample of new business units added to the
Business Register during 1995-96. The sample for the 1996-97 survey was again in two parts.
The first formed the longitudinal or continuing part of the sample, comprising all those
remaining live businesses from the 1995-96 survey. The second part comprised a sample of
new business units added to the Business Register during 1996-97. A similar procedure was
followed for the 1997-98 survey. Approximately 6,400 business units were surveyed in each
of 1995-96, 1996-97 and 1997-98. The BLS did not employ completely random samples. The
original population (for 1994-95) was stratified by industry and business size, with equal
probability sampling methods being employed within strata. Further stratification by
innovation status, exporting status and growth status took place for the 1995-96 survey.
Data collection in the BLS was achieved through self-administered, structured
questionnaires containing essentially closed questions. Copies of the questionnaires used in
each of the four annual collections can be obtained from the ABS. The questionnaires were
piloted prior to their first use, and were then progressively refined after each collection in the
light of experience. As well as on-going questions, each questionnaire also included once-off
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questions dealing with certain matters of policy interest to the federal government at the time
of the collections. In the current study, such once-off questions relate to training methods,
fields and providers; processes used to manage health and safety; and employer associations
and other external agencies.
Various imputation techniques, including matching with other data files available to the
ABS, were employed to deal with any missing data. Because information collected in the
BLS was sought under the authority of the Census and Statistics Act 1905, and thus provision
of appropriate responses to the mailed questionnaires could be legally enforced by the
Australian Statistician, response rates were very high by conventional research standards –
typically exceeding 90 per cent.
The specific BLS data used in this study are included in a Confidentialised Unit Record
File (CURF) released by the ABS on CD-ROM in December, 1999. This CURF contains data
on 9,731 business units employing fewer than 200 persons – broadly representing SMEs in
the Australian context. Restricted industrial classification detail, no geographical indicators,
presentation of enterprise age in ranges, and omission of certain data items obtained in the
BLS all help to maintain the confidentiality of unit records.
This research is concerned only with the manufacturing sector of the BLS CURF. There
are two reasons for this. First, over the last few decades, the performance of the Australian
manufacturing sector has been a major preoccupation of policy-makers and government
departments dealing with industry and trade. The sector has been characterised as noncompetitive by international standards, and it is considered to have failed in countering
Australia’s growing trade imbalance with the rest of the world (Pappas et al. 1990). The
second reason for considering only the manufacturing sector is that it is highly probable that
cross-industry differences in the nature of business activities, typical employment per
business, capital intensity, etc. could confound findings relating to SME development
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patterns, and to SME growth and performance more generally. Such influences are, to a
reasonable extent, controlled for by examining a single (albeit broadly defined) industry.
There are 3,411 manufacturing SMEs in the BLS CURF, representing approximately 35 per
cent of businesses in the file.
Additional focus is provided to this research by considering only manufacturing SMEs
legally organised as proprietary companies. There are two main reasons for this further
narrowing of the unit of analysis. First, as Freedman and Godwin (1994, 234) indicate, a
particular concern with proprietary companies is not uncommon amongst SME researchers
world-wide:
It would appear that, in so far as the issue is considered at all, the limited liability
company is of more interest to the small business research community than are
unincorporated firms; limited liability companies and entrepreneurship have become
equated, or at least associated.
Second, the primary concern in this research is with SME growth and development, and it is
more likely that these will be evident in businesses legally organised as proprietary
companies (Freedman and Godwin 1994; Hakim 1989; Gray 1992; Hughes and Storey, 1994;
Yellow Pages Australia 1995). There are 2,413 manufacturing SMEs legally organised as
proprietary companies in the BLS CURF, representing approximately 71 per cent of
manufacturing SMEs in the file.
Variables used in this research are either categorical in nature or, if metric, have
irregular distributional properties (that is, they are non-normally distributed). Transformation
of metric variables to produce normal distributions is avoided because of difficulties of
interpretation often created by such procedures. Thus, non-parametric/distribution free
techniques of statistical analysis are employed exclusively. Frequency distributions and/or
descriptive statistics for industrial relations and HRM variables across the low, moderate and
high growth SME development pathways are initially presented. Further evidence for the
statistical significance of apparent relationships between SME growth and variables are
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examined using either Kruskal-Wallis one-way analysis of variance tests, or Chi-Square tests.
Following establishing that linkages appear to exist, and are statistically significant, where
data is available, Friedman two-way analysis of variance tests are performed in order to
determine whether linkages persist over time. If such linkages persist over time, they are
sufficiently important to warrant further attention from the relevant researchers and policymakers.
The BLS CURF included information in the subject areas industrial relations, training,
health and safety processes and patterns of employment. Highly statistically significant
findings are summarised under these general headings.
FINDINGS
Industrial Relations
Union Membership
Table 1 presents frequency distributions for union membership in low, moderate and high
growth SMEs for each of the four years in the longitudinal panel. Inspection of Table 1
reveals that approximately 70 to 80 per cent of SMEs on the low growth pathway have no
union members. This compares with around 30 to 40 per cent of businesses on the moderate
growth pathway, and about 5 to 20 per cent of those on the high growth pathway. Hence,
union membership appears to be higher amongst concerns that are growing more rapidly. The
statistical significance of union membership across the three identified growth development
pathways are examined using a series of Kruskal-Wallis tests (Table 1). In each of the four
years, union membership is significantly greater amongst high than moderate or low growth
manufacturing SMEs (p<0.001).
‘Insert Table 1’
A series of Friedman tests conducted to determine whether statistically significant
linkages between union membership and the variable indicating SME development pathways
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persist over the four years of the panel, reveal a highly significant decline in union
membership in workplaces following the low (n=618, H=60.700, df=3, p<0.001) and
moderate (n=200, H=22.540, df=3, p<0.001) growth development pathway. While still
experiencing a significant decline in union membership, this linkage appears to be weaker for
high growth SMEs (n=39, H=7.744, df=3, p<0.05).
Number of Unions
Table 2 shows the average number of unions at high, moderate and low growth workplaces
from 1995-96 to 1997-98. An examination of Table 2 suggests that in all three years, the
average number of unions per SME appears to be greater amongst higher growth SMEs. A
series of Kruskal-Wallis tests reveal statistically significant differences between union
numbers and the variable indicating SME growth development pathways. In 1995-96, 199697 and 1997-98 high growth manufacturing SMEs are represented by more unions than
moderate or low growth SMEs (p<0.001). Friedman test statistics show that there is a
statistically significant decline in unions in SMEs following the low growth pathway between
1995-96 and 1997-98 (p<0.01), whereas this is not the case for higher growth SMEs (Table
2).
‘Insert Table 2’
Employment Arrangements
Table 3 displays frequency distributions for employment arrangements in SMEs following
each of the growth development pathways from 1994-95 to 1997-98. In all four years of the
longitudinal panel, low and moderate growth SMEs are most likely to have one or more
employees on awards. High growth workplaces are also most likely to have employees on
awards in 1994-95. However, in 1995-96 high growth SMEs are as likely to have one or more
employees on individual contracts, as awards. By 1996-97, employees are more likely to be
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on individual contracts, while registered agreements are more likely in high growth
workplaces in 1997-98. Low, moderate and high growth SMEs are least likely to have one or
more employees covered by ‘other’ employment arrangements. A series of Chi-Square and
Kruskal-Wallis tests indicate that there are significant differences in employment
arrangements between slow, moderate and high growth SMEs (Table 3).
First, in all four years, there is an increase in registered agreements across SME growth
development pathways. The incidence of registered agreements is significantly greater
amongst high than moderate or low growth SMEs (p<0.001). Businesses following the high
growth development pathway are also statistically more likely than moderate or low growth
SMEs to have individual contracts in operation in 1994-95, 1995-96, 1996-97 and 1997-98
(p<0.05). High growth workplaces are most likely to have unregistered agreements in 199495 (p<0.001). In contrast, high growth businesses are significantly less likely than moderate
or low growth SMEs to have awards in operation in each of the four years of the longitudinal
panel (p<0.05).
‘Insert Table 3’
A series of Friedman test results (Table 4) show that between 1995-96 and 1997-98,
SMEs following the moderate and low growth pathways experience a significant decline in
employees on awards (p<0.001) and increase in registered agreements (p<0.05). There is also
a significant decrease in unregistered agreements in low growth SMEs (p<0.01). In contrast,
there are no significant variations in employment arrangements in high growth SMEs over
the longitudinal panel.
‘Insert Table 4’
Employer Associations and Other External Agencies
Employer associations and other external agencies may provide assistance to SMEs,
including advice on industrial relations. Manufacturing organisations in particular, have a
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high incidence of employer association membership (Morehead et al. 1997). As shown in
Table 5 low, moderate and high growth SMEs are most likely to use law firms for assistance,
and least likely to use government small business agencies, with over two thirds of businesses
in the three identified pathways reporting no use of their services. The results of KruskalWallis tests for SME growth development pathway differences are presented in Table 5.
Moderate growth manufacturing SMEs make significantly greater use of both law firms
and industry association/Chamber of Commerce than do high or low growth SMEs
(p<0.001); high growth SMEs are statistically more likely to use consultants (p<0.001). Firms
following the low growth pathway are significantly less likely than higher growth SMEs to
use government small business agencies (p<0.05) (Table 5).
‘Insert Table 5’
Training
Thirty-five per cent, seventy per cent and ninety-two per cent of SMEs on the low, moderate
and high growth pathways respectively have tertiary qualified managers in 1994-95. The
number of workplaces with managers undertaking training in business management on the
low, moderate and high growth pathways is thirty three per cent, sixty one per cent and
seventy two per cent respectively. Thus managers with tertiary qualifications, and
undertaking business management training appear to be more prevalent amongst concerns
that are growing more rapidly. The results of Kruskal-Wallis tests for SME growth
development pathway differences show that managers from high growth workplaces are
statistically more likely to have tertiary qualifications than managers from moderate or low
growth firms (n=871, H=158.867, df=2, p<0.001). Similarly, managers in high growth
manufacturing SMEs are also more likely to undertake training in business management
(n=871, H=98.05, df=2, p<0.001).
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Training Changes
Frequency distributions reveal that in all four years of the longitudinal panel, SMEs in each
of the three development pathways identified by McMahon (forthcoming) are most likely to
report no major change in training provision, with approximately half of all SMEs stating
training remained the same as in the previous year. However, when change occurs, SMEs are
more likely to increase than decrease training.
Chi-Square tests for SME growth development pathway differences are presented in
Table 6. In three of the four years, higher growth SMEs are more likely to increase training,
while in 1995-96, moderate and low growth SMEs are more likely too (p<0.001).
‘Insert Table 6’
Training Methods
Low, moderate and high growth SMEs are most likely to have employees participate in onthe-job training, and least likely to use job rotation/exchanges. Low growth workplaces are
also least likely to use seminars/workshops/conferences (Table 7). Kruskal-Wallis statistics to
test for SME growth development pathway differences are also shown in Table 7. Compared
to moderate or low growth SMEs, high growth SMEs are more likely to have employees
engaged in structured training, seminars/workshops/conferences (p<0.001) and on-the-job
training (p<0.01). Moderate growth businesses are more likely than high or low growth
SMEs to use job rotation/exchanges (p<0.001).
‘Insert Table 7’
Training Fields
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A further series of Kruskal-Wallis tests reveal that businesses following the high growth
pathway are statistically more likely than those on the moderate or low growth pathway to
train employees in health and safety, management, professions, apprenticeships/traineeships,
computers and ‘other’ training (p<0.001). Frequency distributions are presented in Table 8.
‘Insert Table 8’
Training Providers
Workplaces following the low, moderate or high growth development pathways are most
likely to use employees or business owners to provide (on-the-job) training, and least likely
to use ‘other’ training providers (see Table 9 for frequency distributions).
Chi-Square tests reveal a significant increase in use of training providers across the
SME development pathways (Table 9). High growth SMEs are significantly more likely than
moderate or low growth SMEs to have employees or business owners providing structured
training (p<0.001) and on-the-job training (p<0.05). Similarly, high growth manufacturing
SMEs are also statistically more likely to use both professional and industry associations,
equipment manufacturers/suppliers, private consultants, TAFE and universities to train
employees (p<0.001).
‘Insert Table 9’
Health and Safety Processes
Frequency distributions indicate that providing health and safety information to employees is
the process most frequently used to manage health and safety in SMEs in each of the growth
development pathways. SMEs are least likely to have a health and safety training program
(Table 10).
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In relation to SME growth development pathway differences, high growth
manufacturing SMEs are more likely than moderate or low growth SMEs to have a written
statement of management commitment to health and safety (p<0.001). High growth
workplaces are also more likely to have a consultation program with employees, provide
health and safety training and guidelines for identifying and controlling hazards in the
workplace (p<0.001), as well as provide information and regularly inspect workplaces
(p<0.05).
‘Insert Table 10’
Patterns of Employment
The BLS included information on working owners and managers, employment status of
employees (i.e., full and part-time or casual) as well as recruitment and cessation of
employment. Statistically significant findings are reported under these headings.
Working Owners and Full-time Managers
In each of the four years of the longitudinal panel, businesses following the high growth
development pathway are most likely to employ full-time managers, and least likely to have
working owners present (Table 11). In contrast, working owners are more likely to be present
in low growth SMEs, and least likely to employ full-time managers. These variables had
significant Kruskal-Wallis results, indicating higher growth SMEs are significantly more
likely to have full-time managers (p<0.001) and less likely to have working owners (p<0.01).
‘Insert Table 11’
Results of a series of Friedman tests reveal that there is a statistically significant decline
in low and moderate growth SMEs with working owners and increase in SMEs with full-time
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managers over the four years (p<0.001). In contrast, there is no significant variation in these
variables in high growth SMEs over the four years of the longitudinal panel (Table 12).
‘Insert Table 12’
Full-time, Part-time, Casual and Total Employment
Table 13 displays the average number of full and part-time employees, as well as
casuals employed in low, moderate and high growth SMEs. Means for total employment are
also shown. An inspection of Table 13 indicates that full-time, part-time, casual and total
employment appear to be higher amongst concerns that are growing more rapidly.
‘Insert Table 13’
A series of Kruskal-Wallis tests reveal statistically significant variations between SME
development pathways in terms of these variables (Table 13). First, in all four years, there is
an increase in full-time employment across the three identified growth development
pathways, with significantly more full-time employees at high than moderate or low growth
SMEs (p<0.001). In three of the four years, there is an increase in part-time employment
across pathways-again, high growth SMEs are statistically more likely to employ part-time
employees than moderate or low growth SMEs; in 1996-97, moderate growth SMEs employ
significantly more part-time workers (p<0.001). In 1995-96, 1996-97 and 1997-98 the
average number of casual employees is significantly greater in high growth compared to
moderate or low growth SMEs (p<0.001). Finally, in each of the four years of the
longitudinal panel, high growth SMEs employ significantly more employees than moderate
or low growth SMEs. (p<0.001).
The results of a series of Friedman tests conducted to determine whether statistically
significant linkages between these employment variables and the variable indicating SME
development pathways persist over the four years of the longitudinal panel are presented in
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Table 12. Both high and moderate growth SMEs experience a statistically significant increase
in full-time and decrease in part-time employment (p<0.05). Part-time employment also
declined in low growth manufacturing SMEs, as did full-time and total employment
(p<0.001). In contrast, there is no significant variation in total employment in higher growth
SMEs between 1994-95 and 1997-98. There is also no significant variation in casual
employment in each of the firms following the three identified growth development pathways
over the longitudinal panel.
Labour Turnover: Recruitment and Cessation of Employment
Table 12 shows the average number of new managers recruited in low, moderate and high
growth SMEs in 1994-95. An examination of Table 12 reveals that more managers are hired
amongst manufacturing SMEs that are growing more rapidly. Kruskal-Wallis statistics to test
for SME growth development pathway differences (Table 13) indicate that high growth
manufacturing SMEs employ significantly more new full-time managers than do their
moderate or low growth counterparts (p<0.001).
Table 12 also presents the average number of new employees recruited, as well as
employees who ceased employment in 1995-96, 1996-97 and 1997-98 across the low,
moderate and high growth development pathways. In relation to SME growth development
pathway differences, a series of Kruskal-Wallis tests indicate that in each of the three years,
high growth manufacturing SMEs employ significantly more new employees (Table 13).
Over the same period, high growth SMEs are also more likely than moderate or low growth
SMEs to have employees who ceased employment (by way of resignation, redundancies,
dismissals etc.) (p<0.001).
Friedman test results displayed in Table 12 reveal that there is a significant decline in
both recruitment and cessation of employment in moderate growth manufacturing SMEs
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between 1995-96 and 1997-98 (p<0.05). In contrast, recruitment and cessation of
employment appears to be more stable in SMEs following the high or low growth
development pathway.
DISCUSSION AND CONCLUSIONS
The aim of this study was to examine possible connections between SME growth and
industrial relations and HRM practices. Key correlates with SME success (in growth terms)
are summarised below.
First, there is a strong suggestion that union membership and number of unions are
significant and consistent concomitants with SME growth, particularly when viewed in the
context of the wider industrial relations environment-which has seen both a decline in
unionised workplaces in Australia (ACIRRT 1999; Peetz 1999) and in manufacturing
organisations, as well as a reduction in the average number of unions per workplace in the
manufacturing sector (Morehead et al. 1997).
Second, based on the evidence presented, employment arrangements are significant
and/or consistent concomitants with SME growth. The current study suggests that the
expanded range of options available to employers and employees with respect to agreement
making (Van Gramberg et al. 2000) have been utilized by growing SMEs. Moreover, these
options, namely unregistered and registered collective agreements and individual contracts,
correlate with manufacturing SME success. However, contrary to a diminishing role, in the
present study, union membership and unions have a positive association with SME (growth)
success.
In terms of employer associations and external agencies, there is a suggestion that
government small business agencies are a less significant concomitant with SME growth than
management consultants, law firms and industry association/Chamber of Commerce. The
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BLS CURF sought only to determine the frequency with which business information was
sought from the various sources, and was not confined to industrial relations matters.
Nevertheless, the fact that manufacturing SMEs were least likely to seek advice from
government small business agencies, with approximately two thirds of workplaces reporting
no use of these agencies, warrants further attention from researchers and policy-makers in
this field.
Research shows that investing in human resources is a potential source of competitive
advantage, and has a positive correlation with stock market performance and profitability
(Huselid et al. 1997). Evidence in the present study also suggests that training correlates with
manufacturing SME growth. The key findings from this research into SME growth and
training can be summarised as follows.

Higher growth manufacturing SMEs are more likely to have tertiary qualified managers,
as well as managers undertaking training in business management. This may, in part at
least, be due to recognition by growing SMEs of the need to develop managers capable of
managing in an internationally competitive marketplace (e.g., Karpin 1995).

Increasing training is a significant and relatively consistent concomitant with SME
growth. The fact that training has a positive effect on organisational success provides
support for the various attempts by governments to encourage industry to expend
resources on employee development.

Structured
training
courses,
seminars/workshops,
on-the-job
training
and
job
rotation/exchanges are significant concomitants with SME growth.

In terms of training fields, training in management, professions, computers, trades and
apprenticeships, health and safety, as well as ‘other’ training are significant correlates
with SME growth.
22

Training provided by ‘other’ providers is a less significant concomitant with SME growth
than employees or business owners providing structured training, professional and
industry associations, equipment manufacturers/suppliers, private consultants, TAFE and
universities training employees, and on-the-job training provided by employees or
business owners.
Thus higher growth manufacturing SMEs provide comprehensive training and
development activities – HRM practices designed to improve current employee skills.
These findings are sufficiently important to warrant further attention from both
researchers and policy makers in the field. This is particularly pertinent given that many
Australian organisations invest little in training (Davidson 1996) and recent research shows a
decline in the average level of training investment per employee in Australian organisations
(Howes 1998).
Finally, patterns of employment that correlate with manufacturing SME growth success
are outlined below.

Working owners are a less significant and consistent concomitant with SME growth than
full-time managers.

Recruiting full-time managers is a significant correlate with SME growth. However,
an increase in full-time managers should not be surprising given that a growing firm
inevitably reaches a point where the owner can no longer make all decisions alone.

Full-time employment is a significant and consistent concomitant with SME growth.
Again, this finding is not unexpected considering SMEs generally require more
employees in order to continue to grow.

Increasing and decreasing employee numbers are both significant and consistent
concomitants with SME growth. This finding, together with the finding that casual
employment is a significant and consistent correlate with SME growth, suggests that
23
labour flexibility, and in particular numerical flexibility, is important to manufacturing
SME (growth) success.
Collectively, these findings add to an increasing body of empirical studies (Huselid
1995; Ichniowki et al. 1996; Ichniowski et al. 1997; MacDuffie 1995) suggesting that certain
industrial relations and human resource management practices are positively related to
organisational performance - in this case, with SME manufacturing growth.
As noted earlier, the BLS included one-off questions on training methods, fields and
providers; employer associations and other external agencies; and health and safety
processes. In order to determine whether statistically significant linkages between industrial
relations/HRM practices and SME growth persist over time, future data collections need to be
on-going. Furthermore, if linkages between industrial relations/HRM practices and SME
growth persist over time, such linkages are sufficiently important to warrant further attention
from researchers and policy-makers. In addition, data collection of a more comprehensive
range of HRM items including recruitment and selection practices, performance appraisal
techniques, as well as incentive schemes would enable future researchers to more thoroughly
investigate relationships between HRM practices and SME performance.
Both researchers and small business alike have acknowledged that growing businesses
need to develop their HRM practices (Gilbert and Jones 2000; Hornsby and Kuratko 1990).
Furthermore, any assistance would need to come from sources that understood both the
dynamics of small business, as well as their HRM priorities (Gilbert and Jones 2000). The
findings identified in the current study may in part, meet this need.
24
ACKNOWLEDGMENTS
The permission of the Australian Statistician to use confidentialised data from the federal
government’s Business Longitudinal Survey, and to publish findings based on analysis of that
data, is gratefully acknowledged. Responsibility for interpretation of the findings lies solely
with the author.
The author also wishes to thank Professor Richard McMahon for his assistance during the
preparation of this article.
25
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28
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29
TABLES
Table 1 SME Growth Development Pathway Differences: Results of Kruskal-Wallis Tests for Union Membership (1994/95 - 1997/98)
1994-95
1995-96
1996-97
1997-98
Frequency (%) of SMEs
a
a
a
a
Union Membership
L
M
H
L
M
H
L
M
H
L
M
H
No union members
425
(68.8)
62
(31)
2
(5.1)
472
(75)
67
(33)
7
(17.9)
476
(75.7)
65
(32)
7
(17.9)
499
(79.3)
80
(39.4)
8
(20.5)
up to 10%
79
(12.8)
37
(18.5)
8
(20.5)
63
(10)
38
(18.7)
7
(17.9)
62
(9.9)
39
(19.2)
5
(12.8)
43
(6.8)
40
(19.7)
5
(12.8)
11 - 25%
33
(5.3)
23
(11.5)
3
(7.7)
24
(3.8)
22
(10.8)
2
(5.1)
19
(3)
21
(10.3)
5
(12.8)
25
(4)
19
(9.4)
5
(12.8)
26 - 50%
31
(5)
24
(12)
3
(7.7)
25
(4)
24
(11.8)
6
(15.4)
30
(4.8)
29
(14.3)
6
(15.4)
35
(5.6)
30
(14.8)
8
(20.5)
51 - 75%
21
(3.4)
29
(14.5)
17
(43.6)
23
(3.7)
32
(15.8)
12
(30.8)
26
(4.1)
29
(14.3)
9
(23.1)
27
(4.3)
34
(16.7)
13
(33.3)
76 - 100%
29
(4.7)
25
(12.5)
6
(15.4)
22
(3.5)
20
(9.9)
5
(12.8)
16
(2.5)
20
(9.9)
7
(17.9)
0
(0)
0
(0)
0
(0)
b
Total
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
b
Kruskal-Wallis Statistic
151.287
160.541
172.032
157.227
df
2
2
2
2
Significance
0.000***
0.000***
0.000***
0.000***
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < .05, ** p < 0.01, *** p < 0.001
a
In 1994-95, 1995-96, 1996-97 and 1997-98 union membership is significantly greater in high than in moderate or low growth SMEs.
b
In 1994-95 totals do not add to 629 and 203 for low and moderate growth SMEs respectively, as small number of cases missing.
2
Table 2 SME Growth Development Pathway Differences: Results of Kruskal-Wallis Tests for Union Numbers (1995/96 - 1997/98). Table 2 also displays
Friedman tests for SME growth and number of unions.
Averagea number of unions per
workplace
Test Details
1995-96
1996-97
1997-98
Test Values
Friedman
test statistic
df
Significance
Low growth SMEsc (n=629)
0.3
(0.6)
0.3
(0.8)
0.2
(0.6)
10.992
2
0.004**
Moderate growth SMEs
(n=203)
1.0
(1.0)
0.9
(1.0)
1.1
(4.1)
2.798
2
0.247
High growth SMEs
(n=39)
1.2b
(0.8)
1.1b
(0.9)
1.1b
(1.1)
0.444
2
0.801
160.377
155.356
160.155
2
2
2
0.000***
0.000***
0.000***
Kruskal-Wallis statistic
df
Significance
* p < 0.05, ** p < 0.01, *** p < 0.001
Statistics are mean; standard deviation in parantheses.
b
In 1995-96, 1996-97 and 1997-98 high growth manufacturing SMEs are represented by significantly more unions than moderate or low growth SMEs.
c
Low growth manufacturing SMEs experience a statistically significant decline in unions between 1995/96-1997/98.
a
3
Table 3 SME Growth Development Pathway Differences: Results of Chi-Square / Kruskal-Wallis Tests for Employment Arrangement s (1994/95 - 1997/98)
Frequency (%) of SMEs
Employment
Chi-Square / Kruskal-Wallis statistic
1997-98
1996-97
1995-96
1994-95
a
Significance
1994-95b
1995-96c
1996-97c
M
H
L
M
H
L
M
H
L
M
H
428
(68)
156
(76.8)
23
(59)d
444
(70.6)
149
(73.4)
20
(51.3)e
401
(63.8)
130
(64)
14
(35.9)f
373
(59.3)
109
(53.7)
14
(35.9)g
7.849
0.02*
78.935
0.000***
38.074
0.000***
12.280
0.02*
Individual
Contracts
206
(32.8)
47
(23.2)
15
(38.5)h
186
(29.6)
104
(51.2)
20
(51.3)I
207
(32.9)
91
(44.8)
26
(66.7)j
204
(32.4)
98
(48.3)
23
(59)k
7.771
0.021*
58.702
0.000***
53.244
0.000***
48.453
0.000***
Unregistered
Agreements
35
(5.6)
25
(12.3)
8
(20.5)l
109
(17.3)
23
(11.3)
4
(10.3)
86
(13.7)
31
(15.3)
3
(7.7)
79
(12.6)
20
(9.9)
7
(17.9)
18.875
0.000***
3.174
0.205
1.927
0.381
2.236
0.327
Registered
Agreements
21
(3.3)
28
(13.8)
11
m
(28.2)
16
(2.5)
43
(21.2)
15
n
(38.5)
28
(4.5)
54
(26.6)
22
o
(56.4)
30
(4.8)
61
(30)
25
p
(64.1)
55.075
0.000***
122.814
0.000***
164.837
0.000***
196.206
0.000***
Other
14
(2.2)
2
(1)
0
(0)
1
(0.2)
0
(0)
0
(0)
0
(0)
0
(0)
0
(0)
N/A
N/A
N/A
2.074
0.355
0.385
0.825
0.000
1.000
N/A
Awards
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, and hence totals will add to more than 100.
b
Chi-Square statistic reported in 1994-95.
c
Kruskal-Wallis statistic reported in 1995-96, 1996-97 and 1997-98.
d to g
In 1994-95, 1995-96, 1996-97 and 1997-98 high growth SMEs are significantly less likely than moderate or low growth SMEs to have awards in operation.
h to k
In all four years, high growth SMEs are more likely than moderate or low growth SMEs to have individual contracts in place.
l
1997-98c
L
Arrangements
Unregistered agreements are significantly more likely to be in operation in high compared to moderate or low growth SMEs in 1994-95.
m to p
In 1994-95, 1995-96, 1996-97 and 1997-98 high growth workplaces are also more likely than moderate or low growth firms to have one or more employees on registered
agreements.
4
Table 4 Friedman Tests for SME Growth and Employment Arrangements (1995/96-1997/98)
Test Values
Employment Arrangements
Friedman
test statistic
Test Details
a
Awards
Individual Contracts
df
Significance
Low Growth SMEs (n=629)
28.994
2
0.000***
Moderate growth SMEsb (n=203)
17.242
2
0.000***
High Growth SMEs (n=39)
2.75
2
0.253
Low Growth SMEs (n=629)
5.413
2
0.067
Moderate growth SMEs (n=203)
2.302
2
0.316
High Growth SMEs (n=39)
2.713
2
0.258
c
Unregistered
Low Growth SMEs (n=629)
10.036
2
0.007**
Agreements
Moderate growth SMEs (n=203)
2.890
2
0.236
High Growth SMEs (n=39)
2.867
2
0.239
Low Growth SMEsd (n=629)
6.514
2
0.039*
Moderate growth SMEs (n=203)
6.713
2
0.035*
High Growth SMEs (n=39)
4.812
2
0.090
Low Growth SMEs (n=629)
1.000
1
0.317
Moderate growth SMEs (n=203)
0.000
1
1.000
High Growth SMEs (n=39)
0.000
1
1.000
Registered
Agreements
Other
e
* p < 0.05, ** p < 0.01, *** p < 0.001
a&b
Between 1995-96 and 1997-98, there is a statistically significant decline in low and moderate growth SMEs with awards.
Registered agreements also declined in low growth SMEs from 1995-96 to 1997-98.
d&e
There is a significant increase in low and moderate growth SMEs with registered agreements over the longitudinal panel.
c
5
Table 5 SME Growth Development Pathway Differences: Results of Kruskal-Wallis Tests for Employer Associations and other External Agencies (1995-96)
Frequency (%) of SMEsa
Moderate growth SMEs
Low growth SMEs
Employer Associations & Other
External Agencies
A
B
C
Solicitors
249
(39.6)
119
261
(41.5) (18.9)
Management Consultants
463
(73.6)
114
(18.1)
Industry Association/Chamber of
Commerce
319
(50.7)
129
181
(28.8) (20.5)
Government Small Business
Agencies
503
(80)e
111
(17.6)
52
(8.3)
15
(2.4)
Test Values
High growth SMEs
Kruskal-Wallis
statistic
df
Significance
16
(41)
48.907
2
0.000***
11
(28.2)d
9
(23.1)d
47.023
2
0.000***
96
59
13
48
(23.6) (29.1)c (47.3)c (33.3)
5
(12.8)
21
(53.8)
69.519
2
0.000***
28
(71.8)
8
(20.5)
3
(7.7)
12.123
2
0.002**
B
C
81
84
11
38
(18.7) (41.4)b (39.9)b (28.2)
12
(30.8)
19
(48.7)
A
102
(50.2)
141
(69.5)
B
61
(30)
45
(22.2)
C
40
(19.7)
17
(8.4)
A
A: Never access assistance
B: Access assistance 1 - 3 times
C: Access assitance more than 3 times
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, hence totals will add to more than 100.
b
Moderate growth SMEs are significantly more likely than high or low growth SMEs to access information from solicitors 1 or more times.
c
Moderate growth SMEs are also more likely to access information from industry association/Chamber of Commerce 1 or more times than high or low growth SMEs.
d
High growth SMEs access information 1 or more times more often from management consultants than moderate or low growth SMEs.
e
Low growth workplaces are significantly less likely than moderate or high growth SMEs to access information from government small business agencies.
6
Table 6 SME Growth Development Pathway Differences: Results of Chi-Square Tests For Training Changes (1994/95-1997/98)
Test Values
Test Variable
Test Details
1994-95
1994-95
1995-96
1996-97
1997-98
Growth Pathway
Chi-Square statistic
24.756a
34.169b
20.942b
24.385b
50.780c
vs
df
6
6
4
6
8
Change in Training
Significance
0.000***
0.000***
0.000***
0.000***
0.000***
* p < 0.05, ** p < 0.01, *** p < 0.001
In 1994-95, high growth SMEs are statistically more likely than moderate or low growth SMEs to increase technical training.
b
High growth SMEs are also significantly more likely to increase management training in 1994-95, 1995-96 and 1996-97.
c
High growth SMEs are more likely than moderate or low growth SMEs to increase training in 1997-98.
a
7
Table 7 SME Growth Development Pathway differences: Results of Kruskal-Wallis Tests for Training Methods (1997-98)
Training
Method
On-thejob
Structured
Seminar/
workshop
Frequency (%) of SMEs
b
c
Job rotation
/exchange
a
d
e
L
M
H
L
M
H
L
M
H
L
M
H
None
309
(56.9)
41
(24.3)
7
(18.9)
139
(25.6)
11
(6.5)
2
(5.4)
313
(57.6)
35
(20.7)
5
(13.5)
312
(57.5)
52
(30.8)
13
(35.1)
up to 25%
194
(35.7)
96
(56.8)
23
(62.2)
181
(33.3)
69
(40.8)
14
(37.8)
189
(348)
118
(69.8)
28
(75.7)
131
(24.1)
80
(47.3)
16
(43.2)
26-50%
21
(3.9)
17
(10.1)
3
(8.1)
84
(15.4)
44
(26)
9
(24.3)
23
(4.2)
10
(5.9)
3
(8.1)
61
(11.2)
25
(14.8)
4
(10.8)
51-75%
7
(1.3)
7
(4.1)
3
(8.1)
55
(10.1)
28
(16.6)
6
(16.2)
11
(2.0)
5
(3)
1
(2.7)
26
(4.8)
11
(6.5)
3
(8.1)
76-100%
12
(2.2)
8
(4.7)
1
(2.7)
85
(15.6)
17
(10.1)
6
(16.2)
7
(1.3)
1
(0.6)
0
(0)
13
(2.4)
1
(0.6)
1
(2.7)
629
(100)b
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
Total
Kruskal-Wallis
Statistic
df
Significance
71.414
13.559
73.195
26.579
2
2
2
2
0.000***
0.001**
0.000***
0.000***
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, and hence percentages (across rows) will sum to more than 100.
High growth SMEs are statistically more likely than moderate or low growth SMEs to have employees participating in structured training, on-the-job training
and seminars/workshops/conferences.
e
Moderate growth SMEs are more likely than high or low growth SMEs to have employees in job rotation/exchanges.
b - d
8
Table 8 SME Growth Development Pathway differences: Results of Kruskal-Wallis Tests for Training Fields (1997-98)
Training
Field
Management
Professional
Computers
Trade
Frequency (%) of SMEs
Health & Safety
Other
a
L
M
H
L
M
H
L
M
H
L
M
H
L
M
H
L
M
Hg
None
412
(75.6)
72
(42.6)
14
(37.8)
461
(84.6)
90
(53.3)
13
(35.1)
408
(74.9)
80
(47.3)
12
(32.4)
393
(72.1)
89
(52.7)
19
(51.4)
337
(61.8)
30
(17.8)
4
(10.8)
295
(54.1)
50
(29.6)
5
(13.5)
up to 25%
120
(22)
90
(53.3)
23
(62.2)
73
(13.4)
74
(43.8)
22
(59.5)
121
(22.2)
78
(46.2)
19
(51.4)
133
(24.4)
74
(43.8)
17
(45.9)
177
(32.5)
118
(69.8)
26
(70.3)
197
(36.1)
103
(60.9)
24
(64.9)
26-50%
8
(1.5)
2
(1.2)
0
(0)
5
(0.9)
3
(1.8)
2
(5.4)
13
(2.4)
6
(36)
6
(16.2)
14
(2.6)
3
(1.8)
1
(2.7)
12
(2.2)
10
(5.9)
4
(10.8)
29
(5.3)
9
(5.3)
4
(10.8)
51-75%
4
(0.7)
4
(2.4)
0
(0)
5
(0.9)
2
(1.2)
0
(0)
1
(0.2)
2
(12)
0
(0)
4
(0.7)
1
(0.6)
0
(0)
9
(1.7)
4
(2.4)
2
(5.4)
1
(1.8)
5
(3.0)
2
(5.4)
76-100%
1
(0.2)
1
(0.6)
0
(0)
1
(0.2)
0
(0.0)
0
(0)
2
(0.4)
3
(1.8)
0
(0)
1
(0.2)
2
(1.2)
0
(0)
10
(1.8)
7
(4.1)
1
(2.7)
14
(2.6)
2
(1.2)
2
(5.4)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
629
(100)
203
(100)
39
(100)
Total
Kruskal Wallis
df
Significance
b
c
d
73.400
2
97.430
2
65.932
2
23.947
2
0.000***
0.000***
0.000***
0.000***
e
f
117.702
2
0.000***
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, and hence percentages (across rows) will sum to more than 100.
SMEs following the high growth pathway are significantly more likely than moderate or low growth SMEs to train employees in management training.
c, d, e, f & g
High growth SMEs are also statistically more likely to have professional, computer, trade, health & safety & 'other' training.
b
40.804
2
0.000***
9
Table 9 SME Growth Development Pathway Differences: Results of Chi-Square Tests for Training Providers (1997-98)
Frequency (%) of SMEs
a
Test Values
L
M
H
Chi-Square
statistic
Employees/business owners
providing OTJ training
375
(59.6)
139
(68.5)
30
(76.9)b
8.775
2
0.012*
Employees/business owners
providing structured training
114
(18.1)
71
(35)
19
(48.7 )c
38.865
2
0.000***
Professional Associations
103
(16.4)
79
(38.9)
27
(69.2)d
88.565
2
0.000***
Industry Associations
133
(21.1)
81
(39.9)
24
(61.5)e
51.256
2
0.000***
Training Provider
df
Significance
Equipment manufacturer/supplier
160
(25.4)
87
(42.9)
20
f
(51.3)
30.080
2
0.000***
Private training provider
87
(13.8)
64
(31.5)
17
g
(43.6)
46.357
2
0.000***
TAFE
156
(24.8)
97
(47.8)
24
h
(61.5)
54.019
2
0.000***
2
0.000***
2
0.937
13
31
31
I
University
(4.9)
(15.3)
(33.3)
52.572
15
4
1
Other
(2.4)
(2.0)
(2.6)
0.130
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, and hence percentages (across rows) will sum to more than 100.
High growth SMEs are statistically more likely than moderate or low growth SMEs to have employees or business owners provide on-the-job training.
c, d, e, f, g , h & I
High growth SMEs are also significantly more likely than moderate or low growth SMEs have employees/business owners provide structured training,
use professional and industry associations, equipment manufacturers/suppliers, private consultants, TAFE and universities to train employees.
b
Table 10 SME Growth Development Pathway differences: Results of Chi-Square tests for Health and Safety Processes (1997-98)
10
Frequency (%) of SMEsa
Health & Safety
Processes
Test Values
L
M
H
Chi-Square
statistic
df
Significance
Written Statement
240
(38.2)
144
(70.9)
30
b
(76.9)
80.267
2
0.000***
Consultation Program
322
(51.2)
151
(74.4)
30
(76.9 )c
39.982
2
0.000***
OHS Training Program
206
(32.8)
133
(65.5)
30
d
(76.9)
87.453
2
0.000***
Information Provision
519
(82.5)
177
(87.2)
37
(94.9)e
6.037
2
0.049*
Regular Workplace
Inspection
465
(73.9)
168
(82.8)
33
(84.6)f
8.159
2
0.017*
Guidelines for Hazards
424
(67.4)
165
(81.3)
33
g
(84.6)
17.953
2
0.000***
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Respondents may have provided more than one response, and hence these percentages will sum to more than 100.
b, c, d, e, f & g
High growth SMEs are significantly more likely than moderate or low growth SMEs to have a written HS statement, consultation &
training program, provide information, hold regular workplace inspections & provide hazard guidelines.
Table 11 SME Growth Development Pathway Differences: Results of Kruskal-Wallis tests for Working Owners and Full-time Managers (1994/95-1997/98)
11
1994-95
1995-96
1996-97
1997-98
Frequency (%) of SMEs
H
L
L
M
Working
Owners,
Directors &
Partners
563
(89.5)
168
(82.8)
20
21
20
568
160
552
157
b
c
d
(51.3) (90.3) (78.8) (53.8) (87.8) (77.3) (51.3)
Other Fulltime
a
Managers
325
(51.7)
189
(93.1)
39
f
(100)
321
(51)
M
H
L
M
Kruskal-Wallis statistic & Sig.
36
192
350
194
g
(94.6) (92.3) (55.6) (95.6)
H
L
M
H
547
(87)
148
(72.9)
22
e
(56.4)
16.789
0.000***
11.625
0.003**
9.341
0.009**
12.179
0.002**
39
362
193
h
(100) (57.6) (95.1)
38
I
(97.4)
287.788
0.000***
287.319
0.000***
308.047
0.000***
286.684
0.000***
1994-95
1995-96
1996-97
1997-98
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
Excludes Working Owners, Directors & Partners
b-e
From 1994-95 to 1997-98, high growth SMEs are statistically less likely than moderate or low growth firms to have working owners, directors & partners.
f-I
In all four years, businesses following the high growth pathway are significantly more likely to employ full-time managers than moderate or low growth
SMEs.
12
Table 12 Friedman tests for SME growth and Employment Patterns (1994/95-1997/98)
Employment Patterns
Test Details
a
Low growth SMEs (n=629)
Working owners, directors &
partners
Other Full-time Managers
3
0.000***
Moderate growth SMEs (n=203)
20.258
3
0.000***
High growth SMEs (n=39)
1.821
3
0.610
37.551
3
0.000***
Moderate growth SMEs (n=203)
17.990
3
0.000***
High growth SMEs (n=39)
1.045
3
0.790
18.739
3
0.000***
16.301
3
0.001**
8.588
3
0.035*
51.186
3
0.000***
9.323
3
0.025*
High growth SMEs (n=39)
9.024
3
0.029*
Low growth SMEs (n=629)
0.652
2
0.722
Moderate growth SMEs (n=203)
1.755
2
0.416
High growth SMEs (n=39)
3.656
2
0.161
Low growth SMEs (n=629)
24.458
3
0.000***
Moderate growth SMEs (n=203)
4.236
3
0.237
High growth SMEs (n=39)
7.118
3
0.068
Low growth SMEs (n=629)
3.514
2
0.173
Moderate growth SMEsl (n=203)
6.481
2
0.039*
High growth SMEs (n=39)
0.944
2
0.624
Low growth SMEs (n=629)
2.125
2
0.346
7.555
2
0.023*
2.555
2
0.279
b
c
Low growth SMEs (n=629)
e
Low growth SMEs (n=629)
f
Moderate growth SMEs (n=203)
g
High growth SMEs (n=39)
h
Low growth SMEs (n=629)
Part-time employment
i
Moderate growth SMEs (n=203)
j
Casual employment
k
Total employment
Recruitment of new employees
Test Values
df
Significance
32.397
d
Full-time employment
Statistic
m
Employees who ceased employment Moderate growth SMEs (n=203)
High growth SMEs (n=39)
Continued Next Page
13
Table 12 Notes
* p < 0.05, ** p < 0.01, *** p < 0.001
a &b
c&d
e
Between 1994-95 and 1997-98 there is a statistically significant decline in working owners in low and moderate growth manufacturing SMEs.
Over the same period, there is a significant increase in full-time managers in low and moderate growth SMEs.
There is a statistically significant decline in full-time employment in SMEs following the low growth pathway from 1994-95 to 1997-98.
f & g Conversely,
h–j
full-time employment increased significantly in both moderate and high growth SMEs
Part-time employment decreased in SMEs following each of the three identified growth development pathways between 1994-95 and 1997-98.
k
There is a significant decline in total employment in low growth SMEs over the four years of the longitudinal panel.
l
From 1995-96 to 1997-98, there is a significant decrease in the number of new employees recruited in moderate growth SMEs.
m There
is also a significant fall in workers who ceased employment in SMEs following the moderate growth pathway.
14
Table 13 SME Growth Development Pathway Differences: Results of Kruskal-Wallis tests for Employment Patterns (1994/95-1997/98)
1994-95
1995-96
1996-97
Means for Employment
Employment
1997-98
Kruskal-Wallis statistic
Significance
L
M
H
L
M
H
L
M
H
L
M
H
1994-95
1995-96
1996-97
1997-98
Full-time employment
13.7
51.9
92.2a
12.5
51.1
98.6a
12.6
53.6
106a
12.3
54.3
108.2a
388.013
0.000***
418.514
0.000***
450.614
0.000***
450.114
0.000***
Part-time employment
2
6.4
8.3b
2.2
6.7
7b
1.3
4.3b
2.9
1.4
3.7
4.1b
27.472
0.000***
19.912
0.000***
16.165
0.000***
6.854 .032*
Casual employment
N/A
N/A
N/A
2.2
8.7
11.1
2
8.9
14.8
1.9
8.4
14.7
N/A
66.046
0.000***
75.485
0.000***
68.332
0.000***
Total employment
18.7
64.9
110.8d
17.9
64.5
115.4d
17.1
65.1
119.8d
16.9
64.7
123.5d
432.800
0.000***
454.598
0.000***
485.524
0.000***
475.407
0.000***
New managers recruited
0.2
0.6
1.1e
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
66.104
0.000***
N/A
N/A
N/A
New employees
recruited
N/A
N/A
N/A
3.1
10.9
14.5
f
3
9.9
14.1
f
2.7
8.7
13.9
f
N/A
143.923
0.000***
150.076
0.000***
109.774
0.000***
Workers who ceased
employment
N/A
N/A
N/A
3.4
11.4
12.9
g
3.4
10
13.3
g
3
10
10.6
g
N/A
131.226
0.000***
142.961
0.000***
111.199
0.000***
Patterns
c
c
c
L=Low growth SMEs, M=Moderate growth SMEs, H=High growth SMEs
* p < 0.05, ** p < 0.01, *** p < 0.001
a
In all four years high growth SMEs employ significantly more full-time workers than moderate or low growth SMEs.
b
In 1994-95, 1995-96 & 1997-98 high growth businesses also employ more part-time workers than moderate or low growth SMEs; in 1996-97 moderate growth
SMEs employ significantly more part-time workers.
c
Casual employment is significantly higher in firms following the high growth development pathway than those on the moderate or low growth pathway.
d
In all four years, high growth businesses employ significantly more employees than do moderate or low growth SMEs.
e
In 1994-95 high growth SMEs employ significantly more new managers than moderate or low growth SMEs
f
In 1995-96, 1996-97 & 1997-98 high growth businesses recruit significantly more new employees than moderate or low growth SMEs.
g
High growth SMEs are also statistically more likely than moderate or low growth SMEs to have more workers who ceased employment .