This paper empirically investigates gross job flows and the growth patterns of continuing limited liability companies in Italy over the period 1996-2004, using original data on work forces and other characteristics of the firm. The descriptive analysis reveals that the magnitude of gross job flows among small and medium-sized companies in Italy is lower than what observed in Anglo-Saxon countries, but it is consistent with evidence for the Euro area. Alongside, the magnitude of job flows significantly shrunk in the aftermath of the economic downturn in 2001: firms fared worse than in the late nineties and the labour market became less efficient in allocating job opportunities. The econometric analysis shows that size negatively affects firms’ net employment growth, even though the negative correlation vanishes among companies with more than 24 employees. The impact of age on growth is complex: new ventures and firms that are at most 14 years old outperform the average firm in the sample. On the contrary, age does not have any bearing on the growth of units aged 15 years and more, and it even represents a burden among the oldest firms in the sample.