3 Things You Should Know About Small Business: April 30
NEW YORK (MainStreet) - What's happening in small business today?
1. Small businesses are creating more jobs than you think.The recent tallies of job creation within the small-business sector seem to imply that hiring is slowing. But according to Bloomberg BusinessWeek contributor Scott Shane's column in the San Francisco Chronicle, it's stronger than many people think.
The perception that small businesses aren't hiring comes from the fact that small-business employment hasn't caught up to its pre-recession levels. However, since the recovery began, small and midsize companies are creating jobs at a faster pace than the recovery after the 2001 recession, Shane writes.
He points to recent data showing that small businesses are indeed creating jobs at a faster pace than large companies, yet the perception in the market is that they are not creating jobs.
"Behavioral economists would say it's because we tend to think about economic recoveries in terms of getting back to the way things were before recessions," he writes. "At the current rate of small-business job creation measured by ADP, it will be another year and a half -- the end of 2013 -- before small-business employment gets back to where it was at the end of 2007."
With it being an election year, it will be hard for policy makers to temper unrealistically high expectations of job growth. "The message politicians would have to deliver -- hold on for a while more, we're getting closer -- isn't the kind of uplifting message that gets voters energized, even if it would make sense to economists," Shane writes.