The name “small business” is invoked regularly to support causes that range from taxes to health care, but who is the proverbial “small business” and why does it matter? Statistics say that nationally small businesses employ just over half of all private sector employers; in the last decade, 70 percent of all new jobs were created by small business. While these numbers are compelling, they don’t tell the whole story.
When many of us think of small businesses in Renton, we think of the mom-and-pop store down the street, the gift store, the restaurant or the dry cleaner. However, the U.S. government defines small business as an employer with fewer than 500 employees, which encompasses a wide variety of enterprises from service to manufacturing. These are the businesses that have grown in our communities, many of which have been nurtured over generations. They partner with our schools and universities to develop new technologies, products and provide jobs. Here in Washington the number of small employers was 147,948 in 2006, accounting for 98.2 percent of the state’s employers and 55.7 percent of its private-sector employment according to the last census.
Many of these firms have faced declining revenues in the past year; they have struggled to maintain their workforce and create efficiencies to survive. When the economy rebounds, they will still be here. These companies rely on local talent, partner with state and federal resources, and employ other local businesses. In addition to providing jobs and a tax base which support our schools, parks and municipal services, these local businesses invest in their communities.
It is the small business person and the entrepreneur that make up the backbone of our society. When Wall Street panics and capital markets collapse, it is these businesses that keep growing, investing and creating the jobs of tomorrow. The U.S. Small Business Administration is proud to be the one federal agency that stands by this enormous and critical segment of our economy.
The American Recovery & Reinvestment Act of 2009 (ARRA) signed by President Obama on February 17, 2009, provided far-reaching assistance to small businesses, including an increase in the guarantee on all loans to 90 percent and the elimination of guaranty fees, resulting in substantial savings for small business borrowers. Since the Recovery Act was signed, SBA nationally has supported more than $27 billion in lending to small businesses through its two largest loan products.
Here in Washington, lending continued to increase significantly through the second quarter of the federal government’s 2010 fiscal year ending March 31, 2010. Compared to the first two quarters of 2009, the total number of SBA loans increased 54 percent from 635 to 976 and the dollar volume of lending also increased 91 percent from $169 million to almost $332 million.
Next time you visit a small business in Renton, thank them for what they do. They may be restaurateurs, craftspeople, service providers or entertainers. They might also be architects, engineers, medical technicians, manufacturers, researchers or entrepreneurs. It will be these small business people who will lead us out of this recession and who will provide the jobs for your children and mine.
Calvin W. Goings is regional administrator for the U.S. Small Business Administration. He oversees the Obama Administration’s small business programs and initiatives in Alaska, Idaho, Oregon, and Washington. Prior to joining the Obama Administration, Goings served in key executive positions with the Washington Credit Union League. As senior adviser to the president and the executive director of the League’s non-profit foundation, Goings focused on supporting small businesses and emerging markets. Before his work in the private sector, Goings served in elected office for nearly two decades, as a County Council member, Washington state senator and as a county fire commissioner. He can be reached at firstname.lastname@example.org or 206-553-0291.