Should I Stay or Should I Go? Job Embeddedness and Entrepreneurship in Highly Specialized Communities in Central Mexico

Abstract

This paper focuses on how the individual and community perceptions of workers in relation to their workspace, their community, and their work environment are related to their decision to stay in a job or start their own business in the context of Highly Specialized Communities (HSCs) in the garment industry in Mexico. We draw upon Mitchell et al. (2001) theoretical framework, which suggests that there are numerous threads that connect a company to its employees and their family in a social, physical, and financial network that includes friends, community, and environment where they live. Further, an extension to Mitchell and colleagues’ construct was designed in order to characterize those workers who develop entrepreneurial capabilities in this particular social context and are more likely to set up their own businesses. The analysis was carried out through an empirical study of a sample of 400 workers in micro and small enterprises (MSEs) in the garment industry. The results show that the relationship with the employer and the sacrifice perceived by the subjects for losing their job are variables that significantly intervene in the decision to remain in their job. At the same time, ties with the community positively and significantly increase the probability of entrepreneurship.