THE BLOG
02/26/2013 04:03 pm ET Updated Apr 27, 2013

SBA Resorts to Propaganda and Pixie Dust

At first I thought it was a joke. I received a press release from the SBA's Office of Advocacy with the headline: Small Businesses Leading Nation's Economic Recovery. Amazingly, it wasn't a joke or even a misprint. The release cited the Small Business Economy 2012 Annual Report as the basis for the bold headline. Dr. Winslow Sargeant, Chief Counsel for Advocacy, stated the report demonstrates that small businesses have been at the core of our economy's growth over the past few years.

Really, Dr. Sargeant? I don't think you and I are living in the same country. Survey results are often skewed and research misinterpreted. As my mother used to say, "Figures lie and liars figure."

How could an agency that is suppose to support small businesses make such an egregious claim? How could these ostensible small business champions be so out of touch with reality? It must be the SBA is spreading propaganda in support of the Administration or simply resorting to sprinkling pixie dust with the hope small business owners will magically believe things are good.

Let's look at the facts. The NFIB's (National Federation of Independent Business) January Small Business Optimism Index, budged upward, but barely -- a mere 0.9 points. January's numbers failed to regain the losses caused by December's "fiscal cliff" scare. Expectations for improved business conditions increased by five points, but remain overwhelmingly low - the fourth lowest reading in the survey's history.

Actual job creation and job creation plans are improving nominally, but still not enough to keep up with population growth. "While corporate profits are at record levels as a share of GDP, small businesses are still struggling to turn a profit," said NFIB chief economist Bill Dunkelberg. (Note -- large company's GDP grew at 4% in 2012 while small  business GDP growth was 0%.) 

To further complicate the issue of job creation for small businesses is their inability to find qualified workers. A Wells Fargo/Gallup Small Business Survey, found 53 percent of small business owners who wanted to hire in January couldn't find the qualified employees they need despite the sluggish economy. In the NFIB survey 79 percent of the respondents looking to hire new employees reported few or no qualified applicants for open positions. The Wells Fago/Gallup survey also noted, of those planning to hire in 2013, only 22 percent expect to hire full-time workers.

Small businesses continue to struggle and have been the hardest hit by the economic conditions of the last several years. Promoting propaganda and sprinkling pixie dust won't change a thing. Shame on the SBA.