Small Business Facts
Role in the Economy
Small businesses play a vital role in the
United States economy. Economic progress
on the national front has provided for continued
growth in the small business sector and the
numbers prove that small businesses are more
than just Main Street, USA. There are
about 25.4 million non-farm firms in the
U.S., according to 2004 data. Small
businesses represent more than 99 percent
of all employers, employing 51 percent of
private-sector workers and 40 percent of
workers in high-tech jobs.
Small businesses are highly regarded for
job creation, responsible for producing 60
to 80 percent of all the new jobs. Between
2002 and 2003, small businesses added two
million jobs. They also produced 51
percent of private sector output as well
as represented 97 percent of all exporters
of goods.
Women & Minority-Owned Enterprises
The numbers of women-owned businesses are
on the rise. According to the U.S.
Census Bureau, between 1997 and 2002 women-owned
businesses grew by 20 percent, twice as much
as the national average. The Small
Business Administration’s Office of
Women’s Business Ownership notes that
10.6 million women-owned businesses employ
19.1 million people and contribute $2.46
trillion to the economy.
Minorities are contributing to our national
economy and our communities in greater numbers
every year. The SBA’s Office
of Advocacy published a report in April 2007
detailing the progress of minority-owned
businesses. In 2002, minorities owned
18 percent of all U.S. businesses. African-American
firms saw the most growth from 1997 to 2002,
with Asian-owned firms following second. Hispanics
constituted the largest minority business
community, owning 6.6 percent of all firms.
*The Office of Advocacy report relied
largely on data from the 2002 Survey of
Business Owners
Our nation’s veterans have made America
a safe, secure and thriving country throughout
her history. The proud tradition of
our military extends beyond the battlefield
and into our economic strength. Though
veterans make up 11 percent of the total
population, they own an impressive 14 percent
of all U.S. businesses. To aid the
growth of veteran entrepreneurship, the SBA
instituted the Patriot Express Loan Initiative
in June 2007, a loan program that features
fast turnaround time for veteran loan approvals.
Small Business Share In GDP
At the close of 2005, the American economy
ended its seventeenth consecutive quarter
of real gross domestic product (GDP) growth. Small
businesses owners contributed to the country’s
overall economic health by creating new jobs,
investing in their companies, and developing
innovative products and services.
A 2007 study funded by the SBA found that
between 1998 and 2004, small businesses produced
approximately 50 percent of the nation’s
private, non-farm GDP. The 50 percent
figure is comparable to the past two decades,
as the GDP has fluctuated only slightly over
time
Small Business Role in Federal
Funding
Continued efforts to increase small business
subcontracting, reduce contract bundling,
increase transparency in contracting data,
and improve access to federal procurement
opportunities are working to level the playing
field for small businesses. In 2005,
small firms were awarded more than $79.6
billion in prime federal contracts, according
to statistics from the Federal Procurement
Data System-Next Generation (FPDS–NG).
The Committee hopes to see small businesses
have the opportunity to compete for more
of the $314 billion federal prime contract
budget. In these efforts, Ranking Member
Steve Chabot served as the lead Republican
sponsor on legislation to reform the federal
procurement process through expanded competition
and transparency. In May 2007, the Small
Business Fairness in Contracting Act passed
the House by a vote of 409 to 13. The legislation is
designed to help expand competition and save tax dollars
by providing greater opportunities to small
businesses.
Sources:
The
Small Business Economy: A Report to the
President 2006
U.S.
Census Bureau, Statistics
of U.S. Businesses: 2004
2002
Survey of Business Owners
The
Small Business Administration’s Office
of Women’s Business Ownership
U.S.
Census Bureau, Profile
of U.S. Exporting Companies
The
Small Business Administration’s Office
of Advocacy, Minorities
in Business: A Demographic Review of Minority
Business Ownership |