The U.S. system classifies a small business as an enterprise that employs not more than five hundred employees. However, their size doesn’t mean that they do not contribute significantly to the country’s economy and the local communities, particularly considering that the entire business community consists of over ninety-nine percent of small businesses. When they close, the economy loses, and the local communities also lose.
The Government Loses Taxes
With small businesses comprising over ninety-nine percent of all businesses in the U.S., it’s factual that they are the main contributors of tax to both the local, state, and federal governments. When thriving, these businesses earn more revenues, leading to high remittance of taxes to the government, whereas their failure results in little or no tax remittance to government authorities.
Loss of Local Jobs and Employment Opportunities
U.S. small businesses create over two million jobs annually, further affecting a large number of people who benefit from these employment opportunities. Most importantly, small businesses don’t outsource workers from other states or countries like multinational corporations do; they source local labor, which grows the local economy. This promotes a culture of innovation and creativity in local communities as people get opportunities to express their knowledge and skills. Besides, small businesses act as talent pools for large businesses that employ people who hone their skills and business characters after already working in a small local business. Wherever a small business closes, all these opportunities for jobs, creativity, and innovation are lost, and local communities lose a critical environment to breed talents.
A Country’s Future is Put at Risk
Any business that operates had its beginning as a startup. Although entrepreneurs are endowed with different capabilities, including financial, skills, and capital resources, no business establishes and peaks initially. Similarly, a small business intends to meet customer demands after a critical market survey to fill market gaps. This cannot be achieved without the support of key stakeholders, such as the government that should provide an enabling environment for business growth. If small businesses do not grow to medium size and later large enterprises, a country’s future commerce is at a high risk since the business world is continuously evolving, and there’s a need for new business ideas to develop daily.
The idea of small businesses being over ninety percent of all businesses in the U.S. could be unheard of, but the fact remains that these enterprises need to be supported for growth. Unless it happens, people are likely to lose jobs, the government will lose taxes, and the country’s commerce can fall apart. Support your local businesses. Shop local. Sign up for local loyalty rewards app and maximize your own benefits while you contribute to the lifeblood of our communities.
