When you think about going grocery shopping, what is the first place that comes to your mind? Some may say Target and others Walmart. What about the first place when you think about coffee? Most people, whether they like it or not, will think about Starbucks. These three businesses have one thing in common: They are major chain stores and multinational companies.
These big companies are prevalent all around the world, so one may think that they are the most important influencers for economic growth. However, this might not be entirely true as many economists believe that the real influences and the core of U.S.’s economic growth are actually small businesses. According to the Huffington Post, small businesses and startups are the companies that keep, not only the national economy moving, but local economies as well, which is why consumers should support them.
Small businesses are one, if not the main hiring industry there is. According to Entrepreneur Magazine there are between 25 and 27 million small businesses in the U.S. that account for 60 to 80 percent of all U.S. jobs. This percentage increases even more if we start narrow it down by community. According to the U.S. Small Business Administration, in Florida alone, small businesses make up 98.9 percent of all employers in the state and employed 3.2 million people, or 42.8 percent of the private workforce in 2014. This is a huge impact if we also consider that since they are small companies they are more flexible. The diversity of people, not just working for small businesses, but creating work opportunities, outnumber those of large companies. The greater diversity there is in an economy, the easier it is for the economy to withstand tough conditions.
This leads to the second reason why small businesses are the backbone of the economy: They adapt easily to changing climates. According to the Huffington Post, if a country falls into an economic crisis, many of their loyal customers will stay with them during these hard times since many of those businesses are customer-oriented. In addition, because these businesses don’t usually accumulate a lot of revenue, they have less to lose in times of economic crisis. This allows many small businesses to stay afloat during crisis and help strengthen their local economy.
Finally, whether the business grows or fails, they can still help their communities. If a business grows it could become a major player in the national and international marketplace. Nike and Ben and Jerry’s are a few examples of small businesses that kept growing, and now they dominate and are major representatives of their industries. Furthermore, businesses such as Nike tend to establish their headquarters in the community they started at. This leaves a huge impact on that community and their surroundings by providing more jobs, gaining outside recognition and stimulating the local economy. If they fail, that “turnover” gives the community a chance to learn from it, recover and rebuild, which is beneficial to the community in the long run.
