We know that small businesses fuel the economy and keep dollars in the community. But don’t take our word for it. A Cal State study, “The Economic Impact of the Small Business and Disabled Veteran Business Enterprise Programs on the State of California,” concluded that small businesses can have a substantial impact on local economies — and government-issued contracts are a critical factor affecting how small businesses succeed.
In the study, Professors Sanjay Varshney and Dennis Tootelian say that “small businesses are the lifeblood of the economy in the United States.” We couldn’t agree more. Here are a few interesting findings:
- Small business accounts for 99.2% of all employer firms and drives the economic engine of the State.
- Based on data from the U.S. Census Bureau, the Office of Advocacy at the U.S. Small Business Administration documented that small businesses accounted for over 92% of the net new jobs creation between 1989 and 2003.
- Of the total 21.8 million jobs created between 1989 and 2003, small businesses under 20 employees created 18.6 million jobs, small businesses with between 20 and 500 employees created 1.5 million jobs, and large businesses and companies (with over 500 employees) created only 1.7 million jobs.”
- The total net new economic activity generated by the State through contracting with SBs [Small Businesses] and DVBEs [ Disabled Veteran Business Enterprise] through gross State output is approximately $4.243 billion, is at least $2.523 billion, and is as high as $6.408 billion.