Over a recent 15-year period, small businesses created some 65% of the net new jobs in the private sector, according to conservative estimates cited in a new report from the SBA Office of Advocacy.

In An Analysis of Small Business and Jobs, (www.sba.gov/advo/research/rs359tot.pdf) Advocacy economist Brian Headd notes that many of the new jobs are in new business startups, but an even larger share are in expanding firms of all sizes—particularly mid-sized firms with 20-499 employees.

“More and more, we’re finding that both new startups and ongoing high-growth firms have important roles to play in the labor market,” said Acting Chief Counsel for Advocacy Susan M. Walthall. “Fast-growing firms scattered across the economy create a large share of jobs—and because no one can predict which idea will be the next to catch on, it’s important to create an environment in which a wide spectrum can start up and expand.”

Advocacy’s analysis of the quarterly Bureau of Labor Statistics data show that over the 15 years from 1993 to mid-2008, 31% of net job gains (jobs created minus jobs lost) came from the opening of new establishments. An even larger share—the remaining 69%—were from ongoing firms of all sizes that expanded. (These net figures are based on establishment openings minus closings and establishment expansions minus contractions.)   The business cycle is an important factor in the net creation or loss of jobs. In the current downturn, firms with fewer than 20 employees began losing jobs as early as the second quarter of 2007. From 2008 to the second quarter of 2009, these smallest firms accounted for 24 percent of the net job losses, while those with 20-499 employees accounted for 36 percent; the remaining 40 percent of job losses were in large firms with more than 500 employees.

The Office of Advocacy, the “small business watchdog” of the federal government, examines the role and status of small business in the economy and independently represents the views of small businesses to federal agencies, Congress, and the President.  It is the source for small business statistics presented in user-friendly formats, and it funds research into small business issues. 

For more information and a complete copy of the report, visit the Office of Advocacy website at www.sba.gov/advo.

According to a recent survey, nearly half of small-business respondents said they would consider exporting their goods or services if the most significant challenges and barriers were addressed. The National Small Business Association (NSBA) and Small Business Exporters Association (SBEA)—a council of NSBA—has released the 2010 Small Business Exporting Survey on the state of exporting for America’s small-business owners.

“Given the specter of a jobless economic recovery and lagging consumer spending,” stated Todd McCracken, president of NSBA, “Exporting may be one of the few areas remaining where small businesses can grow right now.”

The 2010 Small Business Exporting Survey, conducted March 1 through March 5, 2010, among 250 exporting and non-exporting members of NSBA and SBEA, shows that, among small-business respondents not currently exporting, the largest barrier is a perceived lack of exportable products and services. Thirty-eight percent of non-exporters said they don’t know enough about exporting and aren’t sure where to start, and 28% cited concerns over getting paid from a foreign customer.

When asked whether they would be interested in exporting if some of these concerns were addressed, 43% said they would. Among current exporters, the chief concerns include their ability to get paid, and the complexity associated with exporting.

Underscoring the need for better assistance—both technical and financial—the majority of small exporters rely on earnings and savings of their business to finance exporting, not bank loans or government-backed programs. Furthermore, 96% of small exporters handle exporting operations within the company rather than use an external export management company.

The economic difficulties over the past two years, coupled with ongoing outsourcing, have put small businesses at a distinct disadvantage in the global economy. NSBA and SBEA have been urging for years that more must be done to emphasize the needs of small business within the scope of U.S. trade, and applauds the recent announcements by President Barack Obama and his administration to enhance exporting opportunities for small U.S. companies through the National Export Initiative.

“Today, though small-business exports represent less than five percent of the GDP, with aggressive support from the U.S. government, this contribution could be significantly increased,” stated said SBEA Board Chair Susan Corrales-Diaz, president of California-based Systems Integrated.

Please click here to access the full survey.

The U.S. Small Business Administration is anticipating a March 10 date to resume approving eligible loans made possible under the American Recovery and Reinvestment Act (ARRA). President Barack Obama signed legislation March 2 that extends until March 28 the U.S. Small Business Administration’s ability to provide ARRA loans.  

SBA estimates the additional funding will support about $1.8 billion in small business lending.

 Loan applications from borrowers in SBA’s Recovery Loan Queue will be funded first, followed by new loan applications.

 “These key loan programs have been successful in helping jump-start the economic recovery for America’s small businesses,” said SBA Administrator Karen Mills. “The increased guarantee and reduced fees on SBA loans helped put almost $22 billion into the hands of small business owners and brought more than 1,100 lenders back to SBA loan programs. As a result, average weekly loan approvals by SBA have climbed by 87 percent compared to the weekly average before passage of the Recovery Act.

 “We will continue working with the President and with Congress to move forward with proposals for a longer extension for these important program enhancements, as well as higher loan limits, refinancing for commercial property loans and other significant ongoing support for small businesses. Small businesses need the changes the President has called for to ensure that they have the tools they need to drive economic growth and create jobs in communities all across the country.”

As part of the Recovery Act, SBA received $730 million, which included $375 million to increase the SBA guarantee on 7(a) loans to 90% and to waive borrower fees on most 7(a) and 504 loans.  The funds for these programs were exhausted on Nov. 23, and an additional $125 million was provided in December. Those funds were exhausted in late February.

SBA has implemented the Recovery Loan Queue twice before as part of its temporary transitions back to pre-Recovery Act lending.  Eligible small businesses, in consultation with their lender, could choose to be placed in the queue for possible approval of a Recovery Act loan if funding became available from loans canceled for a variety of reasons.  Currently there are 652 loan requests totaling $230 million in the Recovery Loan Queue.

The extension signed by President Obama authorizes the higher guarantee levels through March 28, 2010, for 7(a) loans.  The fee relief is available until the additional funding is exhausted or the end of the fiscal year on Sept. 30, whichever comes first.  As was the case in November and again in February, SBA is prepared to transition into a queue system as the funds start to wind down in order to ensure the maximum simulative effect of the programs and disbursement of funds.

For non-Recovery Act 7(a) or 504 loans already funded during the transition period, this extension does not provide a retroactive guarantee or waived fees.  Loans that were funded under non-Recovery Act terms cannot be canceled and resubmitted to take advantage of the Recovery Act extension provisions.

This extension does not affect other SBA Recovery Act programs, including the America’s Recovery Capital (ARC) loan program or the agency’s microloans.

Recovery Act funding still remains available for both of those programs.

More than half of small business owners (53%) believe that stockpiling cash is the best strategy for sustaining their business through the current economic climate, according to a survey released today by Brother International Corporation. The “Brother Small Business Survey” also found that most small business owners (79%) will strive to make their company more efficient this year.

“Small business owners are feeling extremely anxious about the economy and their business, so they are stockpiling their cash now to help guarantee they can survive the economic downturn and best position themselves for long-term success,” said John Wandishin, senior director, product marketing and marketing communications, Brother International Corporation. “To help cut costs, small business owners are seeking ways to make their business more efficient and one way is through an investment in office supplies and equipment that are reliable and that will give them the best value for their money.”

Efficiency is a key driver for small business owners in 2010. Seventy-nine percent of respondents said they plan to make their company—including employees, marketing budgets, and workspace—more efficient.

The survey also revealed the following key findings about small business owners’ reaction to the current economic landscape:

• Small business owners would consider taking drastic and desperate measures to keep hold of their company. In an example of the pressure still felt by many small business owners, 15% say they would give up 10% of their company in exchange for a guarantee that they’d be protected from negative economic effects in 2010.

• The economy has taken a toll on small business owners’ well-being. 51% of small business owners find that their stress level is at the highest it’s ever been, or higher than usual, as a result of the economic climate. Close to half (48%) think about their business while trying to fall asleep.

• Despite the hardships, most small business owners enjoy owning their own business. In fact, 65% believe they put in more hours than if they worked for someone else. However, 50% of small business owners enjoy the flexibility that comes with “being your own boss” and a third (35%) enjoy pursuing their passion.

The survey was conducted among 500 U.S. small business owners by Wakefield Research (www.wakefieldresearch.com) between January 19h and January 27, 2010, via telephone. Results of any sample are subject to sampling variation. The magnitude of the variation is measurable and is affected by the number of interviews and the level of the percentages expressing the results.

The U.S. Small Business Administration has released a proposed rule aimed at expanding federal contracting opportunities for women-owned small businesses (WOSB). The proposed rule is available for public comment for 60 days.

The proposed rule is part of the Obama administration’s overall commitment to expanding opportunities for small businesses to compete for federal contracts, in particular those owned by women, minorities, and veterans. This proposed rule identifies 83 industries in which WOSBs are under-represented or substantially under-represented in the federal contract marketplace. This rule is aimed at providing greater opportunities for WOSBs to compete for federal contracts, while achieving the existing statutory goal that 5 percent of federal contracting dollars go to women-owned small businesses. 

“Women-owned small businesses are one of the fastest growing segments of our economy, yet they continue to be under-represented when it comes to federal contracting,” said SBA Administrator Karen Mills. “Across the country, women are leading strong, innovative companies, and we know that securing federal contracts can be the opportunity that helps them take their businesses to the next level, expand their volume and create good-paying jobs. This proposed rule is a step forward in helping ensure greater access for women- owned small businesses in the federal marketplace.”

The creation of a rule to increase federal contracting opportunities for WOSBs was authorized by Congress in 2000. Since that time, SBA took a number of steps to study and analyze the market, including looking at participation by women-owned small businesses across all industries. Various draft rules were made available for public comment in prior years, but the Obama Administration chose last year to draft a new, comprehensive rule, based on the analysis of the prior studies and on all the questions and comments previously received.

Some of the components of the proposed Women-Owned Small Business rule include:

•           To be eligible, a firm must be 51% owned and controlled by one or more women, and primarily managed by one or more women. The women must be U.S. citizens. The firm must be “small” in its primary industry in accordance with SBA’s size standards for that industry. In order for a WOSB to be deemed “economically disadvantaged,” its owners must demonstrate economic disadvantage in accordance with the requirements set forth in the proposed rule. 

•           Based upon the analysis in a study commissioned by the SBA from the Kauffman-RAND Foundation, the proposed rule identifies 83 industries (identified by “NAICS” codes) in which women-owned small businesses are under-represented or substantially under-represented.   

The SBA has identified eligible industries based upon the combination of both the “share of contracting dollars” analysis, as well as the “share of number of contracts awarded” analysis used in the RAND study. This differs from an earlier proposed version of the rule which identified only four industries in which women-owned small businesses were under-represented. This earlier version proposed to identify eligible industries based solely on the “share of contracting dollars” analysis used in the RAND study. 

•           In accordance with the statute, the proposed rule authorizes a set-aside of federal contracts for WOSBs where the anticipated contract price does not exceed $5 million in the case of manufacturing contracts and $3 million in the case of other contracts. Contracts with values in excess of these limits are not subject to set-aside under this program.

•           The proposed rule removes the requirement, set forth in a prior proposed version, that each federal agency certify that it had engaged in discrimination against women-owned small businesses in order for the program to apply to contracting by that agency.

•           The proposed rule allows women-owned small businesses to self-certify as “WOSBs” or to be certified by third-party certifiers, including government entities and private certification groups. 

The proposed rule requires WOSBs which self-certify to submit a robust certification at the federal ORCA Web site and also to submit a core set of eligibility-related documents to an online “document repository” to be maintained by the SBA.  Each agency’s contracting officers will have full access to this repository.   

The SBA intends to engage in a significant number of program examinations to confirm eligibility of individual WOSBs.

In the event of a contract protest or program review, the SBA will be entitled to request substantial additional documentation from the WOSB to establish eligibility.

SBA intends vigorously to pursue ineligible firms which seek to take advantage of this program and in so doing to deny its benefits to the intended legitimate WOSBs. 

The public may submit comments to this proposed rule up until close of business on May 3, 2010, to www.regulations.gov, or by mailing them to Dean Koppel, Assistant Director, Office of Policy and Research, Office of Government Contracting, U.S. Small Business Administration, 409 3^rd St. SW, Washington, DC  20416.   Please reference RIN 3245-AG06 when submitting comments.

A Web chat with experts from the Small Business Administration (SBA) will provide help to small businesses looking to grow or expand in the federal government marketplace. The chat will be on March 4 from 1 p.m. to 2 p.m. EST.

Karen Hontz, Office of Government Contracting and Business Development, and Pam Swilling, Office of Surety Guarantees at the U. S. Small Business Administration, will host the February Web chat on “Contracting Opportunities & Surety Bonds.”  Hontz and Swilling will answer questions on doing business in the federal market and how small contractors can get assistance in obtaining surety bonds.

SBA’s Web chat series provides small business owners an opportunity to discuss relevant business issues online with experts, industry leaders and successful entrepreneurs.  Chat participants have direct, real-time access to the Web chats via questions they submit online in advance and during the live session, with instant answers.

Participants can join the live Web chat by going online to www.sba.gov, and clicking “Online Business Chat.”  Web chat participants may post questions before the February 25 chat by visiting http://web.sba.gov/livemeeting/Mar10/ and posting their questions online. 

Archives of past Web chats are available at www.sba.gov/tools/monthlywebchat/index.html

Fewer American workers (72%) love their job just as much or more now than they did in 2009 (78%), according to a recent survey conducted by Adecco Group North America (www.adeccousa.com), a recruitment and workforce solutions provider. Additionally, only 39% feel appreciative of having a job, compared to 55%feeling this way a year ago. According to the survey authors, these results may suggest a renewed “war for talent” in the coming months.

The survey also found:

• Gen Y is falling out of love with their jobs. More than a quarter (26%) of Gen Y workers are nervous about the instability of their job and 27% love their job less than last year, nearly a 10% jump over the 16% who felt this way last year.

• Younger generations may go back to school. Twenty percent of Gen X and 17% of Gen Y workers are thinking about going back to school.

• Gen X are most likely to rethink their careers. If workers had the option to start their careers over again, about half (51%) would change their current profession, particularly Gen X workers. Fifty-six percent of them said they would start over compared to only 38% of older adults.

• Less appreciation and confidence in management. Similarly to 2009, workers’ perception of company leadership continued to wane as only 7% of workers noted the economic situation had positively impacted their confidence in their executive team versus 90% in 2009. Additionally, there’s less appreciation for bosses as only 10% of workers appreciate their boss more in 2010 as a result of the economic situation versus 16% feeling this way last year.

“As America recovers from a tough economic climate in 2009, those who survived the recession may be questioning if they still want the same job or career when employment opportunities rebound,” said Joanie Ruge, Adecco Group North America senior vice president. “In 2010, I think we’re going to see business leaders start to get a little more aggressive—thinking about and consciously deciding when to shift to a more optimistic, opportunistic employment stance. That shift is going to be critical for employers who want to attract and retain the best, strongest talent. Likewise, for candidates today who may be looking to shift careers or experience, they may want to consider applying for temporary and project-based jobs that can shift their career in the direction of higher growth opportunities.”

What to do?

Adecco Group North America provides the following tips for employers as they prepare for a potential shift in the job marketplace:

• Open the communication door. Employees may have less confidence in leadership because they don’t feel like they have a say. Solicit both formal and informal feedback; keep staff informed and use town hall meetings, open conference calls, regular e-mail communication, and  newsletters to drive employee confidence and productivity.

• Make retention a high priority now. Retention efforts begin through mutual dialogue and building trust. Engage employees in the realities of your business challenges to foster an understanding of the market and competition. Consider mapping out a growth plan for employees and communicate it to your teams.

• Recognize and reward. Employees’ feelings may be waning about their employers because many companies have experienced salary freezing or asking their workforce to work harder with fewer staff support. Creatively recognize and reward employees through alternative means —potentially either through an awards program or team contest.

In addition, gestures of appreciation— a thank you e-mail/note, recognition during meetings, a small gift card or surprise pizza lunch, can be impactful and effectively demonstrate appreciation for hard work and dedication. Being more creative with these sorts of rewards can help improve employee morale while continuing to be financially responsible.

President Obama has announced two new small business lending initiatives to help increase access to capital and create jobs. These temporary Small Business Administration (SBA) initiatives include a refinancing program for small business owner-occupied commercial real estate and an expanded working capital loan program.

At the same time, the President continued his call for a permanent increase of the maximum loan sizes for SBA’s 7(a), 504, and microloan programs and to extend the successful small business Recovery Act lending programs. These initiatives are part of the Administration’s broader agenda to improve access to credit for small businesses, including a proposal to transfer, through legislation, $30 billion to a new Small Business Lending Fund that will support lending by community and smaller banks.

The new proposals:

• Expand SBA’s existing 504/Certified Development Company (CDC) program temporarily to support refinancing for small business owner-occupied CRE loans that are maturing in the next few years and help refinance over $20 billion each year in commercial real estate that might otherwise be foreclosed and liquidated.

• Temporarily increase the cap on SBA Express loans from $350,000 to $1 million to expand access to much-needed working capital and allow more small businesses to take advantage of the streamlined approval process.

More information about these proposals is available on the SBA Web site, www.sba.gov/.

Do you believe paying taxes is voluntary? Or that you don’t have to comply with an administrative summons about your taxes? Think again. These beliefs—and many others—are erroneous, says the Internal Revenue Service, which has released the 2010 version of its discussion and rebuttal of many of the more common frivolous arguments made by individuals and groups that oppose compliance with federal tax laws.

Anyone who contemplates arguing on legal grounds against paying their fair share of taxes should first read the 80-page document, The Truth about Frivolous Tax Arguments.

The document explains many of the common frivolous arguments made in recent years and it describes the legal responses that refute these claims. It will help taxpayers avoid wasting their time and money with frivolous arguments and incurring penalties.

Congress in 2006 increased the amount of the penalty for frivolous tax returns from $500 to $5,000. The increased penalty amount applies when a person submits a tax return or other specified submission, and any portion of the submission is based on a position the IRS identifies as frivolous.

IRS highlighted in the document about 40 new cases adjudicated in 2009. Highlights include cases involving injunctions against preparers and promoters of Form 1099-Original Issue Discount schemes and injunctions against preparers and promoters of false fuel tax credit schemes.

Florida small business owners are more concerned with keeping their current customers than the rest of U.S. small business owners, according to The Guardian Life Index: What Matters Most to America’s Small Business Owners.

The Guardian Life Index is based on a proprietary 21-point scale (from +10 to -10) and measures the positive and negative intensity of responses to 135 small business issues. Compared to the national findings which are based on 1,100 respondents, Florida small business owners expressed the greatest difference in the following areas:

• Keeping the customers from leaving (FL: 6.3 vs. U.S.: 5.6);

• Setting my business apart from our competitors (FL:5.3 vs. U.S.: 4.7);

• Our number one goal is making more sales than last year (FL: 4.4 vs. U.S. 2.8);

• We devote most of our time to increasing sales (FL: 3.9 vs. U.S. 2.8).

The research also reveals that 52% of small business owners in Florida plan to maintain business as usual compared to 54% nationwide. Additionally, 32% are confidently looking forward to expanding their businesses over the next 12 to 24 months compared to 38% nationally.