The size–growth relationship in the social services sector in Austria

The social services sector is among the fastest-growing industries, but it has gained little attention in the debate regarding firm growth. This article analyzes firm growth in relation to firm size using payroll expenses as our indicator for both firm growth and firm size. We apply structural equation modeling and full maximum likelihood estimation using Austrian data comprising all non-profit social service providers. After 2013, fewer firms have been entering and more have been exiting the sector; however, we find that growing in size is still not associated with higher growth rates. Our study emphasizes the role of small organizations in remaining a growth sector.