Small Businesses As Employers

Steve AdamsNew England Regional Advocate

U.S. Office of Advocacywww.sba.gov/advo

The Small Business Market

1. What does post crisis economy mean for jobs?

2. What is the small business sector?3. How is the small business sector

different?4. Engaging the small business sector.

Economy that emerges from recession will be very different.

• High consumer debt + slow income growth = Weak consumer spending in US.

• Less capital sloshing around the world + weak demand = much lower investment returns.

United States household credit market outstanding debt

Small firms will be source of most net new jobs

• General demand will stagnate causing large companies to shed jobs.

• Growth will come from serving niche markets and providing specialized goods and services.

• Small firms will be best suited to exploit growth opportunities.

Small firms are the market

• Small firms employ 50% of workers.• 86% of all NE and US employers have <20

employees.• Small firms represented 70% of net new

jobs in last decade.• Smalls dominate all sectors, not just “mom

& pops”.

Massachusetts small businessesCompany Sales Emp Business

Cantata Technology $95,000,000 200 Computer software development;

Haley & Aldrich Inc $92,229,903 200 Business Consulting, Engineering Services

Conversent Communications $70,000,000 200 Data Telephone Communications

Wsi Corp $75,000,000 190 Data Processing/Preparation

Princess House Inc $90,634,000 166 Wholesale Nondurable Goods

Universal Millennium $95,000,000 150 Commercial lithographic printing

Hallmark Health Corp $91,300,000 150 Health Services Business Services

Newbury Comics Inc $74,481,176 125 Retail Records/Cd's/Tapes Ret Gifts/Books

Dover Saddlery Inc $81,392,373 120 Retailer Of Equestrian Equipment

E & P Enterprises Inc $100,000,000 110 Travel Agency

Edgewater Tech $73,743,000 100 Technology Management Consulting

Sleepmed Inc $89,975,000 96 Medical Laboratory Home Health Care Services

Vertical Communications $72,594,000 71 Business & professional software publishers

Massachusetts small businessesCompany Sales Emp Business

Dotcommerce Ltd $35,000,000 21 Internet Web Page Design

Northeast Interiors $34,834,018 24 Residential Construction

Jfs Inc $32,115,063 10 Data Processing/Preparation Computer Services

Data Associates Business Trust $28,000,000 30 Prints promotionals

May Technolgies Inc $26,000,000 5 Manufacturing Representitives

Harpell Inc $25,800,000 15 Transactive Marketing

Allied Supply Chain Solutions $22,432,890 13 Supply Chain Management,Consumer Electronics

Daymark SolutionsInc $22,000,000 25 Whol Computers/Peripherals

Intra Systems Inc $20,000,000 23 Computer Systems Design

Ebizbrokers Inc $17,500,000 7 Business Services

Overdrive Interactive LLC $15,000,000 30 Management Consulting Services

Small firms can be attractive• Opportunity to get diversity of experiences,

play numerous roles.

• Willingness to train to suit need.

• Can be more cohesive environment.

• High-energy, more purposeful.

• Differences between small and large firms are shrinking – that post-crisis economy thing.

Small Businesses Don’t Always Stay Small

Inc 500 companies– 56% started in founder’s home– 93% from working or middle-class families– 46% founders had less than a 4-year degree– 24% started with less than $10,000– 70% started with less than $50,000– 62% started with at least one partner– Average age of company - 8 years old

Workforce Issues Top Small Business Concerns

• Finding qualified workers is among top 3 barriers to small business growth.

• Rising cost of health care insurance is #1.

Small firms need help finding qualified workers

Small business outreach:This takes work

• Recognize challenges faced by small firms.– Time, expertise, schedule flexibility, HR

outreach capability.• Specialize.

• Partner with trade associations.

Small business outreach• Innovative (?) approaches:

– Have students ID firm-types and firms with data bases, e.g. Dunn & Bradstreet.

– School facilitate match-making.

• Facilitate strategic partnerships between College department and businesses:– Provide access to continuing education,

pipeline of workers, access to workforce programs.

Resources/Trade Associations

• Hitachi Foundation Report: Building Strong Partnerships with Businesses Maximizing Your Organization’s Workforce Development Potential. www.hitachifoundation.org /pdfs/pocket_guide_nonprofit.pdf

• Smaller Business Association of New England: Trade association of small businesses. www.sbane.org/

• Massachusetts Innovation & Technology Exchange: industry association where digital marketing, media and technology converge. www.mitx.org

• Greater New England Minority Supplier Development Council: Local affiliate of national organization created by large corporations to certify minority-owned suppliers. www.cmsdc.org/

• Regional Technology Corporation: Western Massachusetts organization of technology firms. http://rtacentral.com/.

• New England Technology Sales Executives Association. www.netsea.org • National Federation of Independent Businesses.. www.nfib.org

 

Thank You

Steve AdamsSteve AdamsNew England Regional AdvocateNew England Regional Advocate

(617) 565-8418(617) 565-8418stephen.adams@sba.govstephen.adams@sba.gov