Our nation’s smallest businesses—those with 1-49 employees—continue to outpace large businesses in the race to put America back to work. Businesses with fewer than 50 employees created more than half of all new jobs last month, and, from April to May, they boosted the actual number of jobs they generated by 16 percent, according to data released Thursday by Automatic Data Processing, Inc (ADP). Small businesses overall accounted for more than 93 percent of all new jobs last month, while large businesses created just 6.8 percent of new jobs.
These figures underscore the starring role small businesses have in helping lower the unemployment rate, and they’re a reminder that the smallest firms are our country’s primary job creators. These businesses can and will put our economy back on track, but they can’t do it singlehandedly. Legislators must continue pursuing pragmatic economic policies that ensure entrepreneurs have they tools they need to keep rebuilding the economy. We suggest:
- Calling on the Federal Deposit Insurance Corporation (FDIC) to issue bank charters that would supply small firms with more credit. The agency has not issued a single charter this year, despite the dismal lending landscape entrepreneurs continue to face: our national opinion polling found 90 percent of small business owners view credit availability as a problem.
- Passing the Small Business Jobs and Tax Relief Act, which would promote small business job creation by providing a 10 percent income tax credit for increased payroll in 2012 while also extending the 100 percent expense deduction for equipment that lowers owners’ after-tax costs.
- Extending the Production Tax Credit for wind project development, as it supports 37,000 jobs that would be at risk if the credit expires. Not only would extending this credit protect existing jobs, small business owners also indicate it could help generate new jobs: 7 in 10 small business owners believe government investments in clean energy play an important role in boosting the economy and creating jobs now.
With ADP’s latest data highlighting small businesses as invaluable assets to the economy, it’s clear we must support them with pragmatic solutions that address their greatest concerns. We encourage lawmakers to pursue robust policies such as those listed above, as failing to do so would only hamper our fiscal recovery.