Is Small Business Recovery a Work in Progress?
As Small Business Week ends, it’s time to turn our eyeballs to the Small Business Administration, which started it all, and see what the state of small business really is.
This week, the SBA said small business creates 2 out of 3 new jobs in the U.S. each year. That’s a big number. One Washington isn’t ignoring.
Pundits of the SBA
But, while Washington recognizes the need to support small business recovery, not all agree that the SBA, and particularly the current Administration, is doing enough. Some say the current Administration is actually hurting small business.
For example, 3M Co. CEO George Buckle in an interview with the Financial Times Newspaper, compared Obama to Robin Hood, and said he was “anti-business.” Buckley warned that Obama’s policies may force businesses to leave the U.S. and set up shop in Canada or Mexico.
RELATED: Finding SBA 504 Loans
How the SBA is Helping Small Business
Of course, the White House didn’t like that. Chief of Staff Bill Daley, a former executive of JPMorgan Chase, rebutted those comments, and Obama has made efforts to correct that perception. Part of those efforts are reflected in the release of a 78-page report about the state of small businesses and what the SBA has done to help small businesses grow the last 2 years.
It reports on new small business policies, tax breaks, efforts to boost small business loans, support for exports and expanded government contracting. Some of those details include more than $50 billion in federal loan guarantees in the last two years, and programs that have counseled more than 2 million business owners.
On its website, the SBA says:
“This report focuses on the vital role that America’s entrepreneurs and small business owners play in strengthening the U.S. economy. The Obama Administration has put new initiatives and increased incentives in place to support small businesses – including 17 tax cuts, improved access to capital and expanded support for high growth businesses – as they continue to out-compete and out-innovate the rest of the world.
“Over the past two and a half years, President Obama has enacted sweeping changes to support, reinvest, and revitalize America’s economy in the wake of a major recession. As a result, large U.S. firms are now making powerful new investments, including building new facilities and buying new equipment.”
Among Obama’s biggest initiatives was a $30 billion lending fund that offers community banks low-cost capital if they increase business loans. Bloomberg reported that the fund has received 645 applications seeking $9.62 billion, and that “some banks that received money through the Troubled Asset Relief Program are swapping their TARP capital for money from the new fund.”
Is Small Business Recovery Really Working?
This seems to depend on who you ask.
“There’s very little question that small business is now once again contributing to job creation and helping to lead a job recovery that is strengthening, but we would still like to see much stronger,” said Gene Sperling, director of the National Economic Council, to Bloomberg reporters. “We feel very strongly we have come a long way, and that this economy still has a lot further to go.”
Bloomberg writer John Tozzi wrote “A Tale of Two Recoveries” at the end of April. The article outlines recent sentiment surveys that show small businesses have grown more pessimistic about their prospects, while larger companies envision much greater growth. Some of sentiments weren’t based on fact, rather perception. Many people still believe the economy is down, which affects their day-to-day business strategies.
RELATED: Finding SBA 7(a) Loans
Now it’s in your court. Is this working? Has Obama’s initiatives made it better for small business? Are you more confident in the economy?