In his comprehensive article on labor demand in the Handbook of Labor Economics, Hamermesh (1986: 455) states: “It is true that in contrast to the myriad studies of labor supply based on households, there is a shocking absence of research on the microeconomics of labor demand.” Most explanations of the mobility of workers between different states of the employment system, and sectors, regions, and occupations are traditionally linked to choices of workers and the traits of workers affecting their decisions. With the still rare availability of longitudinal employment data of individual firms empirical investigations have started recendy to focus on labor demand. In this chapter we intend to make a contribution to this literature by analyzing three issues: 1 Dynamics of employment in manufacturing firms. 2 The relationship between firm size and employment growth. 3 The employment effects of newly founded firms.