Just How Big is Small Business?
A lot of the businesses we cover here at Why Didn’t I Think of That? have become huge successes, with millions and millions of dollars in profit, hundreds upon hundreds of employees, and thousands of customers the world over. And yet- almost none of these businesses started this way.
And many of them will never end up that way. Giant corporations have been taking up a lot of news lately. It’s easy to forget how dependent the economy actually is on small businesses.
So just how big is small business?
This last July, Mike Clough wrote a post on his America’s Best Business Practices blog entitled, “America Runs on Small Businesses.” In the post, Clough presents some startling facts about American small businesses.
According to a study by the U.S. Small Business Administration, there are 26.9 million businesses in the USA. Of those, 99.9% have fewer than 500 employees and are considered small businesses.
And, according to the US Census Bureau:
98% of companies patenting telecommunications technology employ fewer than 500 people
97% of companies patenting software employ less than 500 people
92% of companies patenting aerospace products employ less than 500 people
90% of companies patenting pharmaceuticals employ less than 500 people
87% of companies patenting semiconductor technology employ less than 500 people
“It appears self-evident,” writes Clough, “that small business carries most of the weight when it comes to American innovation and job creation.”
Clough’s fantastic article has gotten me thinking. In the next few days, I’ll be addressing several important issues concerning small businesses. For instance: What does it mean to have a successful small business? Why do so many small businesses fail? And, with so many small businesses propping up industry and driving innovation, why is it that America has one of the world’s smallest small-business sectors?
Stay tuned, and thanks for reading.