With 90% of U.S. companies characterized as small-business enterprises and 30% of all working Americans employed at companies with fewer than 100 workers, it’s no question that small business drives the U.S. economy.
Recent studies suggest these companies are growing in number, but they’re also cautious – and cautiously optimistic – about the future. Some small businesses still suffer the effects of the recession. Others are nervous about the outcome of the November elections and the impacts of increasing federal regulations. Still, many possess the confidence common to entrepreneurs that could determine the health and direction of the U.S. economy through year-end – and beyond.
The year 2016 has been an emotional roller coaster for business owners, entrepreneurs, and the lenders who serve them:
- Many small business owners have seen a return of sales and revenues to levels not experienced since before the Great Recession that began in earnest in 2008.
- Given the buoyancy of the economy and overall recovery, start-up activity also has been bullish, as employees are sufficiently optimistic either to leave existing jobs or branch out and launch side businesses in addition to their primary employment.
- Lenders are fielding an uptick in new lending inquiries or actual originations from business owners expanding operations or entrepreneurs launching new enterprises. This traffic historically is a sign of optimism among borrowers.
This is not unique to any one sector. Many companies and industries have enjoyed a consistent, if not complete, recovery since 2008. However, an honest and complete picture must acknowledge concerns of those business owners who have experienced a bumpier, lackluster or even non-existent return to economic normalcy.
As the summer turns to fall and the November elections approach, further uncertainty is forecast. From technology, business funding, and workforce issues, to new business development and governmental regulations, businesses are navigating waters both familiar and uncharted.
While the Fortune 500s get the headlines, the mindset, health, and actions of American small businesses truly drive the U.S. economy. Consider their scope, scale and impact: only one in 10 businesses in the U.S. are publicly traded, reports the Wall Street Journal, and more than 30% of working Americans work at companies with fewer than 100 employees, notes the U.S. Small Business Administration.
The number of those companies seem to be rising, according to the SBA’s 2015 Small Business Bulletin. The SBA measures “small businesses” as those with 499 or fewer employees, which qualifies them for performance tracking and eligibility for programs preferences reserved for “small business” concerns to help them compete in the marketplace.
To read more, download the Small Business Landscape 2016 whitepaper by clicking here.