Report Examines Small Business Economy Of 2009

The U.S. Small Business Administration’s Office of the Advocacy has released a report on the challenging economic conditions of 2009 that found by the end of the year, small businesses found room for optimism.

“In the beginning of 2009 many small businesses felt as if they were at the brink, not knowing how or if they would survive,” said Chief Counsel for Advocacy Winslow Sargeant.

“This report shows that the actions taken by the federal government were beginning to be felt in the small business economy by the end of the year, and that there were signs entrepreneurs were again looking ahead toward new opportunities for small business growth.”

In the first three quarters of 2009, small businesses accounted for almost 60 percent of the net job losses, with the greatest losses in the first quarter. By the third quarter, net small firm job losses were one-third what they had been in the first quarter.

In 2009, the American Recovery and Reinvestment Act (ARRA) generated stimulus activity designed to benefit small firms, among others. The Congressional Budget Office estimated that policy actions added between 1.5 percent and 3.5 percent to real gross domestic product in fourth quarter 2009 and projected an employment increase of 1.0 million to 2.1 million more than it would have been without the stimulus.

The American Express Open Small Business Monitor found that 55 percent of entrepreneurs were optimistic about the future of their businesses in September 2009, up 10 percent from earlier in the year.