Graphical techniques reveal that there is a strong correlation between turnover rates and the firm’s decision not to offer health insurance, and this pattern holds both in the aggregate (Figure 4) and when firm size is controlled for (Figure 5). In each figure, the average turnover rate is measured on the horizontal axis and the proportion of firms not offering health insurance is measured on the vertical axis. Figure 5 shows that even among firms of a given size interval, there is still a significant and positive relationship between turnover rates and firms’ decision not to offer health insurance. We have hypothesized that expected health costs.
