To celebrate National Small Business Week, CAMEO, the California Association for Micro Enterprise Opportunity, supports the truly small businesses that make up 88% of the country’s businesses.
Businesses with five or fewer employees are the new normal. The Bureau of Labor statistics reported in March that the average size of new start-ups was 4.7 employees in 2011 – that’s down from 7.6 employees in the 1990’s. And the share of the self-employed in the labor market is growing more than twice as fast as it did before 2000. Whether it’s the technological gains that allow high productivity or the disappearance of the ‘safe corporate job’, the reality is that businesses are starting smaller (and perhaps staying smaller) and more people want to build their own their own business.
“Last week, Hewlett-Packard announced lay-offs of 25,000. If we want job growth, if we want to solve our long-term unemployed problem, then we cannot rely on the big corporations anymore to create those jobs,” said Claudia Viek, CEO of CAMEO. “As firms get smaller, we need to create more small businesses. These very small or micro-businesses are the future our economy. “
To create more businesses, we need good strategies to help these businesses start and thrive and we need to broaden the spectrum of businesses that we purport to help with current policy. President Obama’s proposed small business tax credit and other tax plans will help some small businesses, but they won’t help the 88% of small businesses with fewer than five employees or the self-employed.
“I’ve learned in my 25 years of experience that the first step to success for locally grown small and micro-businesses is business assistance,” said Ms. Viek. “Then they are ready to get a loan and grow and add jobs. Businesses that receive assistance have an 80% success rate as compared with the 50% to 80% mortality rate for small businesses overall.”
To celebrate National Small Business Week, CAMEO urges policy makers to do something that will really help the majority of small businesses – support business start-ups with business assistance and microloans. Specifically, Congress should fund the SBA PRIME Program, the Microloan Technical Assistance programs, Women Business Centers, and Small Business Development Centers at their 2010 level. The State of California should make it easy for the unemployed to get business training so that they can BYOB – Be Their Own Boss. A relatively small investment in these programs provide big returns in terms of job creation and economic growth.
CAMEO’s mission is to promote jobs, economic opportunity and community well-being through entrepreneurship training, business coaching and microfinance. CAMEO is California’s statewide Micro Enterprise association made up of over 160 organizations, agencies and individuals dedicated to furthering the fortunes of micro-businesses in California.
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