How Important Are Small Businesses?


We hear a lot about large
companies in the news, but small business is the
engine of the U.S. economy. America is home to more than
28 million small businesses that employ 57 million workers. And when you add owners
and employees together, that’s a community of roughly
85 million hardworking Americans dependent on the success of small
business— most of the private-sector workforce. Small business owners are America’s
most important job creators: U.S. small businesses accounted for
almost two-thirds of the net new jobs created between 1993 and 2013— a grand total of 11.8 million
new career opportunities. In 2012, small businesses created
more than 2.1 million net new jobs. Small businesses are the
country’s main job creators, because they are often growing and
looking for new markets to expand. To do so, they need additional
employees along the way. Large businesses, on the other hand,
generally stay the same size, hiring new employees to
replace departing ones. Unfortunately, high taxes and
recent government regulations in health care, finance, and labor
disproportionately hurt small businesses and prevent them from growing and
adding new jobs to the economy. Big business with big profits
can afford to comply with red tape in a way that small businesses
just starting out cannot. As a result, small businesses still haven’t
recovered completely from the Great Recession— and it shows by the chronically
weak labor market. More than 94 million Americans are not
working or actively looking for jobs. The labor force participation rate— which measures the percentage of
employees and job-seekers in the U.S.— is less than 63 percent, the lowest
figure since the late 1970s. To bring small businesses back,
and strengthen the job market, job-killing taxes and regulations
must be rolled back. Job creators should be encouraged
to hire more employees, not forced to reduce
career opportunities. With 85 million people depending on
the success of small business, it’s easy to see why small
business is too big to fail. For more information about small businesses, visit InformationStation.org.

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