When people think about business in the United States, they think about big corporations such as Walmart and McDonald’s. These big businesses are important to the economy, but it is really small businesses that are the main drive.
Small business employs two thirds of the workforce and is the main drive behind a thriving economy. Small businesses drive 44 percent of the economy, higher than what most people think when they think about business generally.
Small business is defined by the ability to receive aid and the number of employees. If an entity has under 500 employees, they qualify as a small business. This makes them eligible for a multitude of federal programs. The small business administration connects small business owners with lenders and funding to help them get their small business started, funded, and off the ground.
There are also grants available for minority business owners. These grants help women and racial minorities get a start on their small business ideas and help get them started. With a good business plan, anyone can take advantage of these start-up programs and get their ideas planted in a new small business. These opportunities for women and minorities offer them financial freedom, success, innovation and a sense of pride.
Small businesses tax rates for a sole proprietorship are 13.3% whereas small partnership and small corporations are between 23 and 26 percent. That does not include the average 15% self-employed people must pay via the SE tax. Taxes never stop the small business owner in the United States.
Small businesses create innovation with fresh ideas. In a 4-year study, large corporations generated a significantly smaller number of patents per employee than did small businesses. Per 100 employees, large corporations generated 1.7 patents whereas small businesses generated 26.5 patents. This shows the innovative quality of small business.
Small businesses help the community in which they are based by providing local taxes, new jobs and innovation. They elevate the local economy across the United States. Some local localities give tax breaks to bring in new small businesses to help fuel their local economy by bringing jobs in and creating a tax base.
Small businesses also help larger corporations by providing parts, goods, and services to the corporations. They create a symbiotic relationship that helps both thrive. Accounting and legal firms are important to larger corporations for their services. Even local business cleaning services are utilized in larger corporate offices everywhere.
In conclusion, small business is essential for thriving local and federal economies. Small businesses provide innovation and necessary services on a local basis. It creates employment and helps create a local tax base in any area. Women and minorities find opportunity in owning a small business not only for the financial freedom, but for the pride and self-sufficiency it brings to them and their family.