Small Business Impact on the Economy
“The Small Business Act states that a small business concern is “one that is independently owned and operated and which is not dominant in its field of operation.” The law also states that the definition of what constitutes a small business will vary from industry to industry to reflect industry differences accurately” (SBA.gov).
What is a small business?
There are an estimated 27 million small businesses in the United States. These small businesses employ around half of the private sector workforce in the United States. 52% of home based businesses fall into the small business category. Roughly 40% of high tech employees are hired by small businesses. An astonishing 97% of all exporters of goods and 99.7% of all employer firms are small businesses.
In Canada, 37% of all jobs newly created in the private sector were in small businesses. 48% of the total private sector labor force is in small businesses. Over two-thirds of the employment created by small businesses was within five industries. Those industries are: the non-institutional health care sector which comprises 89%; the construction industry comprises 76%; other general services compose 73% ; accommodations and food accounted for 67%; and forestry created 67%. (Source: Score.org — Susan Ward at About.com – SBA.gov)
Small Business Marketplace Trends
During 1979-2003, self-employment increasedby33 percent for women, 37 percent for African Americans, 15 percent for Latinos, 10 for White Americans and 2.5 percent for men. (Source: SBA, Office of Advocacy)
Hot Markets
eBay Drop-Off Sites
Search Engine Optimization and Internet Marketing
Performance Apparel
Niche Health and Fitness
Technology Security Consulting
Services/Products for Hispanic-Market
(Source: Entrepreneur magazine, “Newest Trends & Hottest Markets,” January 2005)
Woman in Business
Women represent more than 1/3 of all people involved in entrepreneurial activity. (Source: Global Entrepreneurship Monitor (GEM) 2005 Report on Women and Entrepreneurship)
Between 1997 and 2002, women-owned firms grew by 19.8 percent while all U.S. firms grew by seven percent (Source: SBA, Office of Advocacy)
Women-owned firms accounted for 6.5 percent of total employment in U.S. firms in 2002 and 4.2 percent of total receipts. (Source: SBA, Office of Advocacy)
The number of women-owned firms continues to grow at twice the rate of all U.S. firms (23 percent vs. 9 percent). There are an estimated 10 million women-owned, privately-held U.S. businesses. The greatest challenge for women-owned firms is access to capital, credit and equity. Women tend to start businesses for both lifestyle and financial reasons. Many of these businesses are run from home to keep overhead low. (Source: SBA, Office of Advocacy and Business Times, April 2005)
Women are more likely to seek business advice – 69 percent women vs. 47 percent men. (Source: American Express)
Minority-Owned Businesses
Black-owned businesses are the fastest growing segment, up 45 percent between 1997 and 2002. Revenues generated by the nation’s 1.2 million black-owned businesses rose 25 percent between 1997 and 2002 to $88.8 billion in 2002. (Source: U.S. Census Bureau)
The number of U.S. businesses with Hispanic owners grew at three times the national average from 1997 to 2002 to 1.6 million businesses in 2002, a 31 percent increase from five years earlier. (Source: MSNBC)
Seniors in Business
Entrepreneurship among seniors is growing. In 2002, the rate of self-employment for the workforce was 10.2 percent (13.8 million workers), but the rate for workers aged 50 or over was 16.4 percent (5.6 million workers). Although those age 50 and over made up 25 percent of the workforce, they comprised 40 percent of the self-employed. Projections indicate that solo business formation in the future will be driven by people who take early retirement or whose jobs just disappear. (Source: AARP/Rand Corp. “Self-employment and the 50 Population”)
Veterans in Business
In 2004, about 22 percent of veterans in the US household population were either purchasing or starting a new business, or considering purchasing or starting a business. Nearly 72 percent of veteran entrepreneurs planned to employ at least one person at the start of their venture (Source: US Census Bureau)
All information gathered from: http://www.score.org/small_biz_stats.html