Much has been written over the last several years about the causes of the world-wide economic decline, particularly within the United States, with an equal number of experts proposing a wide variety of solutions to the problem. However, one thing most writers and experts appear to agree on is that any economic recovery in the U.S. is going to be largely dependent upon the growth of the small business sector.
Since the 1990’s, small businesses have been responsible for 60 – 80% of jobs created, according to the Small Business Administration’s Office of Advocacy. In fact, a recent study by researchers from the University of Maryland and the U.S. Census Bureau regarding net job creation by company size shows clearly that the smallest companies (those under 50 employees) are responsible, by far, for the largest number of net new jobs from 1987 to 2005 (see graph below). What’s more, an analysis of U.S. Census data released by the Kauffman Foundation finds that start-ups accounted for 3% of the total number of jobs each year between 1980 and 2005, and since the study defines a start-up as a new business formed in the current year, all those jobs are new jobs.
Given that the data and the experts seem to agree that promoting the growth of small business is imperative to jump-starting the economy, we thought it would be interesting to review a variety of thoughts on how that might be accomplished, and to see what various States and the Federal Government might be doing to assist in this effort. For this trend in small business job creation to continue, it seems to us to be critical that all possible Federal, State and local resources available should be placed into programs that will generate small business growth – whether they be training, tax credits, public/private partnerships to provide access to much-needed capital enabling growth, competitions or any other means of generating small business development.
One article we found interesting was an opinion piece by small business coach, Melinda Emerson, in a recent posting on Small Business Trends. In the article entitled, Will 2010 Be the Year of Start-up America?, Ms. Emerson suggests a variety of strategies designed to drive the growth of small businesses, read the article HERE, we think you’ll find her suggestions have merit.
Another interesting article was an analysis of Michigan Governor Jennifer Granholm’s ‘State of the State’ address in which she placed an emphasis on small business developent to drive jobs creation in the State. With Michigan being on the leading end of the unemployment ranks, she needed to take some bold steps. We think she’s moving in the right direction as she has sought partnerships and strategies proven effective elsewhere to lead her efforts. Read about Granholm’s strategies HERE to see if you agree.
See the links below for information of strategies being employed by other states to increase small business development:
- New York
- New Hampshire
- Various states; legislation to aid small businesses
And what about the Federal government? Do they finally “get” the value of small business and entrepreneurship? A CNN analysis of President Obama’s recent ‘State of the Union’ address noted that he mentioned the term ‘small business’ 14 times during the course of his address. A signficant portion of that address was dedicated to the need to expand entrepreneurship in the U.S. to generate jobs, and stategies that Obama plans to implement over the course of the remainder of his administration. We think it’s a great start but could use the additional creativity of suggestions such as those mentioned in Ms. Emerson’s essay. Read the CNN analysis HERE and let us know what you think.
A large part of the Federal Government’s small business development plans is partnerships with private enterprise which was evidenced by President Obama’s request for private-sector assistance at a late 2009 small business summit; below are links to some interesting initiatives from the private sector:
- Goldman Sachs 10,000 Small Businesses
- Austin education initiatives
- National Broadband Plan
- Millenium Challenge Corporation
As a small business ourselves, and consultants to small businesses, we certainly see the value of the continuing drive in the development of small business initiatives. We encourage small business owners to avail themselves of all Federal, State, local, and private-sector resources they can locate to aid in their growth. This will facilitate jobs-creation and eventually, economic recovery.
Should your firm require assistance in sorting thru the maze of opportunities and resources available to you, we at Strategic Growth Concepts would be happy to assist. Please feel free to contact us to schedule a FREE initial consultation.
The author, Linda Daichendt, is Founder, CEO and Managing Consultant at Strategic Growth Concepts, a consulting and training firm specializing in start-up, small and mid-sized businesses. She is a recognized small business expert with 20+ years experience in providing Marketing, Operations, HR, and Strategic planning services to start-up, small and mid-sized businesses. Linda can be contacted at firstname.lastname@example.org and the company website can be viewed at www.strategicgrowthconcepts.com.