The Small Business Economy the Foundation of the American Economy.
There are roughly 5.7 million small businesses in the United States, and their businesses are vital to our economy. Small businesses produce about half of America’s gross domestic product (GDP), create nearly two-thirds of new jobs annually, and employ around 52 percent of the private sector workforce. Furthermore, 90 percent of new jobs come from small businesses, so it’s no surprise that so many people consider starting their own small business when they leave a corporate job or retire from their previous business venture.
What is a small business?
According to Entrepreneur, a small business is generally considered an independently owned and operated company with annual revenue under $25 million. Revenue is important because it’s a key metric that defines a small business. It does not, however, define its value in society. A number of other metrics are more meaningful than revenue when defining what makes a small business truly great. These metrics include whether or not employees have ownership in their jobs and how much an owner cares about his or her employees’ lives outside work as well as company growth over time . Small businesses help everyone—from customers to communities to owners—as long as they continue to contribute toward success metrics that have remained constant throughout history: creativity, hard work and dedication.
Why are small businesses important?
Small businesses are the foundation of the American economy. But what does that mean? More than just a few mom-and-pop stores, small businesses play an important role in creating jobs and allowing the U.S. to compete globally. Small businesses create more than 50 percent of all new jobs in America, according to Small Business Administration data.
How many are there?
The number of small businesses in America has grown from about 15 million to 30 million over that time. Since then, small businesses have dominated U.S. job creation, particularly during difficult economic times; almost two-thirds of all net new jobs since 2009 have been created by small businesses. However, according to recent data from The Global Entrepreneurship Monitor (GEM), 20 percent less Americans said they were willing to start a business in 2011 than they did in 2007. That doesn’t mean small businesses aren’t succeeding—they are. More and more people are finding success through entrepreneurship, whether it be starting their own company or finding part-time work as an independent contractor for others.
How does the small business do more for Americans than Federal policy.
Small businesses help everyone in a number of ways, according to a small business advocacy group called NFIB (National Federation for Independent Business). Small businesses have been called the backbone and the lifeblood of U.S. economy. These are not idle words; statistics show just how much small businesses do to help everyone. The following is from an NFIB white paper on its website: In fact, when it comes to jobs, small firms create more than 70 percent of all new private sector jobs each year. The report goes on to say that nearly half of all Americans either own or work at a small business. According to another study by SBA (Small Business Administration), one-third of America’s workforce is employed by companies with fewer than 20 employees. And another study showed that more than half of all workers are employed by companies with fewer than 100 employees. It’s also important to note that two-thirds of all net new jobs created since 1980 were created by startups less than five years old. That’s right: Two-thirds!
Part Two…Coming Soon
Until Next Time, “Don’t Do What Tony Stark Would Do, Do Your Own Thing”