This paper provides evidence in favor of a new mechanism that explains the differences in the dispersion of wages across spatial areas: differences in the way firms organize production. Using French matched employer-employee data, I conduct my analysis on manufacturing firms and I emphasize four results. First, the majority of the dispersion in wages is within areas and within firms. Second, there is greater wage dispersion in firms operating in denser areas. Third, firms in denser areas organize with a greater number of layers. And fourth, approximately 21.7% to 46.4% of the relationship between the density of areas and the wage dispersion in firms is accounted for by differences in the way firms organize production.