US Economy Not Growing Without Small Business Gains

Date: June 21, 2016 Last Edit: June 23, 2016

Observers Warn Small Business Owners Need More Supportive Environment

It’s no secret that small businesses are America’s job creators, and a powerful force to drive the US economy. In a recent USA Today op-ed, Lloyd Blankfein, chairman and CEO of Goldman Sachs, Michael Bloomberg, Warren Buffett, and Michael E. Porter, a professor at Harvard Business School, argued that helping small businesses, “which create over 60% of net new private-sector jobs and employ nearly half of America’s workforce,” is “one of the best ways to support economic growth and needs the continued focus of both elected officials and the private sector.” Citing a report released by Babson College which “pinpoints four major challenges that cut across industries: The need for better access to capital, less burdensome regulations, more qualified workers and ability to better assimilate information technology,” they argued that progress in those areas “would provide a significant boost to local hiring – and to national economic growth.”

Despite these suggestions, the AP reports that small business owners are feeling less optimistic about their opportunities to contribute to economic growth. The latest NFIB Small Business Economic Trends report indicated that US small business owners have been “scaling back their plans to invest in equipment and property and build their inventories,” and that there are also “fewer job openings.” These results, the AP says, indicate that small businesses aren’t fully providing “a shot of adrenaline” to the US economy. According to NFIB Chief Economist Bill Dunkelberg, small business owners, faced with uncertain economic conditions and increasingly-burdensome regulations, “are likely to remain conservative for the rest of the year and that in turn will keep the economy growing at a mediocre pace.”

What This Means For Small Businesses

Small businesses can help grow and strengthen the US economy, but they need a favorable regulatory and political climate in which to do so. As observers have recently pointed out, there are some troubling indications that small businesses aren’t receiving the support they need to help drive economic growth.

Additional Reading

In an op-ed in Forbes, NFIB Chief Economist Bill Dunkelberg examines the worrisome lack of growth among small business credit borrowing in the current post-recession economy.

Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.

Related Content: Small Business News | Economy | National

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