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Dismal Small Business Employment Numbers
By Marc Tracy
We always hear about how small businesses are the engine of, yes, national economic growth, but especially of national job creation. In other words, small businesses take up a disproportionate share--more than their sizes would suggest--of U.S. employment and employment growth.
The flip-side of having greater responsibility for rising employment, however, is that small businesses are also likely to play an outsize roll in rising unemployment. Well, the Labor Department reported that unemployment rose to 7.2% (the highest in 16 years) in December. And it appears that small businesses are bearing much of the burden of having to lay off workers (and do the same with less).
Independent Street reports that small and midsize businesses accounted for a higher percentage of the employment decline than did big businesses, according to a report--the first time that occured since that monthly survey began in 2000.
Independent Street points out some of the troublesome implications of this dynamic. For starters, it means the bleeding hasn't stopped, but we already knew that. But really, it probably means that lots of small businesses--and lots more small businesses than big businesses--are really on the ropes: layoffs, after all, are last-ditch moves, not first steps, when dealing with declining business.
Hopefully this news will, if nothing else, attract attention to how important small businesses' ability to stay afloat is to the larger economy. It's a shame it had to come to this, though.
Comments (1)January 12, 2009 2:32 PM
Comments (1)
I agree that it is sad the economy has brought us to this. Jobs are really hard to acquire anymore and are getting harder everyday. Even the jobs that are available are of low pay because businesses can't afford to give more and cut backs are being made everywhere. Hopefully it will get better but all we can do in the meantime is stick it out and do our best to be profitable.
Posted by Click and Inc | January 14, 2009 12:32 PM
Posted on January 14, 2009 12:32