The Importance of Small Business

Small businesses thrive in every sector of the economy and provide jobs for millions of people. They also generate tremendous amounts of wealth and opportunities for local people in local communities.

The need for jobs

Politicians and industry leaders celebrate the role small businesses play in making the economy more diverse and resilient. Small business owners regularly lobby government for greater understanding and the provision of more focussed support.

Small and medium sized businesses provide the majority of jobs in the economy and offer employment in places where large employers often fear to venture. They are geographically spread and varied in nature and in the skills they require. Governments in countries all around the world recognise the crucial role they play but struggle to find effective ways to understand or engage them. Jobs are regularly shed in large organisations as automation and other global trends reduce staff numbers but small businesses provide regular employment as a mainstay of the economy.

Government policies are developed to rebalance the economy but it is difficult to mitigate the drift of populations from rural to city living. Given the importance of small businesses to non-urban areas it is vital for policy makers to include them in the design and development of support initiatives. Not least because within the small business sector there is a sub-set of micro-businesses, usually identified as those employing five employees or less. Such firms, although very small, are no less important as they represent a large number of jobs.

The difficulty of course is to differentiate between large business, medium sized businesses, small businesses, and micro-business. In some cases their needs are similar but in many cases they are different.

The need for support

A range of support appropriate to different types of businesses is required to ensure the whole economy thrives as a collective. Without targeted support large firms grow at the expense of smaller ones and urban areas grow at the expense of rural ones, which creates an increasingly unbalanced society.

Just as the interests of big business are prioritised the needs of small and micro-businesses must also gain attention. There are many ways to make sure each segment of the business sector flourishes but the most effective way is to understand their different requirements.

It is also important to promote a culture of enterprise and entrepreneurship at all levels of the economy and society, as it is one of the few ways to ensure the private sector grows at a rate that compensates for a shrinking public sector. Without investment by small businesses it is impossible to sustain local jobs for local people in local communities. With relatively little support, however, small businesses naturally create the opportunities people need in the places they need them.

So, businesses come in all shapes and sizes but it is time to prioritise support for small and micro-businesses to sustain local jobs and local communities.