Although selected employee characteristics matter, the t-tests in Table I reaffirm that two strongest predictors of a firm’s insurance offer decision are its size and industry. Therefore, we aim for a better understanding of these two dimensions. About 70%of firms that have only one or two permanent employees do not offer health insurance. Figure 1 illustrates that not offering insurance is especially common among very small firms, with proportion of firms not offering insurance stabilizing at 30–50 employees. This size pattern is not explained by the industry mix of small firms: Figures 2 and 3 reveal that firm size remains a strong predictor of whether firms.
