Job Creation and Small Businesses Blog

In the last posting, it was mentioned that small businesses are the engine of the economy. Let’s illustrate the real impact even very small businesses have on their environment and the economy. An image is worth a thousand words. First, let’s start by looking at the impact of a normally employed person, on a basic level. We’re keeping things fairly simple in the following example, in order to make a fair comparison. An employed person usually pays for a roof, food, personal services such as banking, dentist, hairdresser, doctor, and such. Most have a car and/or use public transit, Internet and telephone services. This gives us the following diagram to show the interaction with suppliers:

Now, let’s take the example of small business used in the previous blog, i.e. a small decoration store offering artwork from recycled materials, and see the effect. The same individual, when starting that kind of activity on a small scale, produces far more economic activity, as illustrated below. This level of activity manifests itself in a practically exponential manner over time:

Can you see how many more additional services are needed in order to operate the business? How much more business is created for other businesses and other people, just from this simple enterprise? And can you imagine the effect it has when the business grows? This is why small businesses are truly the engine of the economy. We can safely assume that, at this time, small businesses will truly be an important element to salvage the economy!

In the next posting, I will discuss the necessary qualities to be an entrepreneur, and how to inventory your skills in order to create your dream job. In the meantime, read the book “Whiz Biz in Changing Times” available at: WhizVentures.com. A series of new online seminars will start on February 18, 2009. The seminars are free and a maximum of 20 persons can attend at a time. See the content and register for the seminars on WhizVentures.com.