THE BLOG
11/21/2016 01:25 pm ET Updated Dec 06, 2017

Small Businesses Can Make a Big Impact on the Economy

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Credit: Shreveport-Bossier Convention and Tourist Bureau

Being a small business owner is challenging. Small business owners come from a variety of backgrounds, each with their own reasons for pursuing self-employment. Oftentimes they're independently owned and operated and have few employees. Despite and because of this small businesses are vital to the future of the United States. These businesses might be small but their impact is certainly anything but.

Small businesses are often overshadowed in the news by large corporations and conglomerates. They may not generate as much revenue individually as large corporations but they're vital to the success of our economy. These aren't the mom and pop stores that you'd traditionally imagine and there's more industry variety now than in the past. Nearly anything imaginable can be transformed into a small business with hard work and a little luck.

There are three primary ways that small businesses contribute to our nation. They give people the opportunity to achieve financial independence, encourage innovation, and create employment opportunities. It's that sort of desire for independence that buoyed the freelance contractor economy. Being your own boss is challenging but definitely empowering.

Never forget the impact that your small business can have in your community and the world at large. An article by Dennis Danheiser titled "Life Stories: Small Business Edition" talks about the role each small business owner has in fueling the American dream. Dennis writes, "The opportunity to pursue your passion is exciting, but there are many challenges along the way - money and time management, hiring the right people, and marketing, just to name a few."

Sometimes small businesses are born out of big ideas that no one else believes in yet. Massive companies starting in garages is a real thing too, and that's how we ended up with Microsoft, Apple, Amazon, Google, HP, and Disney. Each of these founders had an innovative idea that they believed in. In many cases, true innovators have to believe in themselves first and prove their ideas can be done before anyone else will believe in them.

Small businesses generate a broad variety of new employment opportunities. It's easy to underestimate their importance if you neglect to look closely at the statistics. Brad Sugars wrote an article titled "How Many Jobs Can Your Startup Create This Year?" that highlights the fact that small businesses account for between 60-80% of all U.S. jobs. Since 1995, small businesses are responsible for paying out 44% of the total U.S. private payroll. Another important advantage of small businesses is that they give money back to their community. If you live in Smalltown, USA and work at Random Small Business LLC, chances are you'll spend that money right where you earned it. That revenue and the resulting tax dollars are then spread around the community, enriching and supporting everyone in the process.

Our nation's stability is in part predicated upon a stable economy and the financial strength derived from these businesses. Small businesses are an engine of growth that allows both citizens and the government to acquire the goods and services they need to grow. At the same time it allows real people with good ideas to act upon them and make their business a reality. In turn this stimulates local (and national) economies and encourages others to take the same leap toward becoming a small business owner.