Small Business: The Real Job Creators

The most annoying thing about the establishment’s ongoing obsession with maintaining the status quo, and supporting and bailing out older and larger companies?

Dinosaurs don’t create jobs.

From the Economist:

Research funded by the Kauffman Foundation shows that between 1980 and 2005 all net new private-sector jobs in America were created by companies less than five years old. “Big firms destroy jobs to become more productive. Small firms need people to find opportunities to scale. That is why they create jobs,” says Carl Schramm, the foundation’s president.

And it doesn’t stop there.

From Wikipedia:

In the US, small business (less than 500 employees) accounts for around half the GDP and more than half the employment. Regarding small business, the top job provider is those with fewer than 10 employees, and those with 10 or more but fewer than 20 employees comes in as the second, and those with 20 or more but fewer than 100 employees comes in as the third.

And government spending today (aside from all the bailouts) hugely favours big business over small business.

From the New York Times:

If you want to understand why cutting the deficit is so hard, you can’t do much better than to look at the Business Roundtable.

The roundtable is one of the more moderate big-business lobbying groups. Its president is John Engler, the former Michigan governor, and its incoming chairman is James McNerney, the chief executive of Boeing. When roundtable officials talk about the deficit, they use sober, common-sense language that can make them sound more reasonable than either political party.

But the roundtable is actually part of the problem.

Rhetoric aside, it consistently lobbies for a higher deficit. The roundtable defends corporate tax loopholes and even argues for new ones. It pushes for a lower corporate tax rate. It favors the permanent extension of the Bush tax cuts. It opposes a reduction in the tax subsidy for health insurance, a reduction that was part of the 2009 health reform bill. Oh, and the roundtable also favors new spending on roads, bridges and other infrastructure.

When will government stop helping big business, and let smaller and newer businesses — the biggest jobs creators — have their share of the pie?

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10 thoughts on “Small Business: The Real Job Creators

  1. The main problem is most people who work for Big Business or Government, seek the job security of a large organisation. They are inefficient and insecure.

    I agree small business is the driver of growth and employment. Most inventors, start out in Tool Sheds or Basement Labs. They take risks and eager employ staff with their own savings. Mind you these workers are usually fanatics and share in the dream at great risk to their own employment. Then Banks lend them money, and finally they get share capital, and listing.

    Government must reduce its Budget and Departments, and monopolistic organisations nationalised as “Public Good” utilities. The Managment of these “Nationalised” utilities must have KPI’s so that they don’t become bloated and inefficient.

    Taxes have to reduce. Voters will go for lower taxes, as long as there is a reduction in government waste. People have to work longer before retirement, so that the younger generation is not burdened with 85 year old pensioners. The reality is we live longer, so why burden the young.

    There is no free lunch. People must work hard for a fair day’s wage, and big business must be controlled to ensure that the scale of efficiency gains are not a ticket to fat risk free profits at the consumer’s expense.

    However in this day and age, we still have the same battle lines between the Communists and Capitalists and every colour in between. When I read the historical newspapers, the same rhetorical stories surface. My advice is to look after yourself first, because if you battle for other people, there is no guarantee, those people will battle for you. This is basic human self preservation.

    And that is why the Politicians will spend, spend, spend, and the rich will evade,evade,evade taxes!

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