Thursday, June 13, 2013

How Important Are Small Businesses?

We often hear that small businesses are the engines of job creation in the United States. According to an article on their value and the role they play in our economy is sometimes underestimated because, they are in fact, small. But the truth is there’s nothing small about the impact they have on our economy. They cite a recent study by Entrepreneur Magazine that there are between 25 million and 27 million small businesses in the U.S. that account for 60 to 80 percent of all U.S. jobs. And, a recent study by Paychex, says that small businesses produce 13 times more patents that larger firms.

Those numbers may be a little high, at least compared to numbers derived from the Census Bureau.  The website offers the following infographic that lays out the importance of small businesses (which typically means businesses with 500 or fewer employees) based on Census Bureau statistics.

Click to Enlarge

  Locally, small businesses make up nearly ALL of the establishments in our area based on the definition above of having 500 or fewer employees. Here's a breakdown for Herkimer and Oneida Counties of the number and proportion of business establishments based on their size (as measured by the number of paid employees that they have). These numbers come from the County Business Patterns for the latest year (2011).