The influence of small business spreading on the dynamics of the labor costs share in value added generated by leading industries of Ukrainian economy

Abstract. The article is devoted to empirical testing of two initial hypotheses. The first is
that the small business spreading in the Ukrainian economy would contribute to changing
conditions of factor incomes distribution in favor of hired workers. The second is exactly such
changes in the distribution of factor incomes (which is expressed by increasing in the share of labor
costs in gross value added generated by leading types of economic activity) will contribute to the
social efficiency increasing of economic activity.
The processes of implementation of the potential of small business to mitigate the negative
social consequences of the deterioration of the macroeconomic situation are researched in the
article. The contribution of small business to the dynamics of the share of wages in the value added
by main types of economic activity was determined and the compliance of the specified
contribution to the potential of a small business to improve the realization of the interests of hired
workers in the relations of factor incomes’ primary distribution was assessed.
The method of "weighted differences" was used for quantitative estimation of the structural
shifts impact on the aggregate for both sectors of large and small business indicators. The
mentioned method was transformed according to the author’s technique in order to include in the
calculations the value of a qualitative indicator by the reporting period against the base period. This
allows us to assess the contribution of qualitative changes, occurring in the small and large business
sectors, to the dynamics of the average characteristics of the factor incomes distribution, inherent to
the leading types of economic activity in the Ukrainian economy.
The obtained results did not confirm the first hypothesis and allowed to substantiate the
conclusion that the spreading of small business by itself (which is not accompanied by qualitative
changes in the role of human resources and improvement of conditions for its reproduction) does
not allow to expect the improving conditions of employees’ access to the main source of
qualification, professional and social mobility — high labor income.