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Small Manufacturers Driving Job Creation, Economic Growth

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Small Manufacturers Driving Job Creation, Economic Growth

By Karen Mills, Former SBA Administrator
Published: March 2, 2012

Made in America is hot.  More than 400,000 manufacturing jobs have been created since the start of 2010 and there are currently about 229,000 job openings in the manufacturing sector, according to data from the Labor Department.

America’s small manufacturers are a critical part of that.  According to BLS and Census data, 98 percent of America’s manufacturing firms are small.  More than one in three Americans who work in manufacturing, work at a small business.  

Everyone from the President on down has been working very hard to make sure these firms have the tools they need to grow and create jobs.

For example, in 2010, President Obama signed into law the Small Business Jobs Act.  One of the most important provisions was increasing the limit on SBA loans from $2 million to $5 million.  The higher loan limits directly helped nearly 2,500 small businesses – including nearly 450 small manufacturers – with access to over $10.2 billion to help buy new buildings, buy more equipment, and hire more workers. 

We’re building on that momentum by taking even more steps to help small manufacturers.

For example, a recent study shows that access to a supply chain can help employers increase revenues by more than 250 percent and create 150 percent more jobs. That’s why SBA is working with America’s biggest companies to develop easier access to those critical supply chains.

In addition, the federal government itself is working to make sure we meet the goal of 23 percent of federal contract dollars going to small businesses, including small manufacturers.  Already, we have had two consecutive years of increases, with nearly $100 billion going to small businesses last year.

Also, a recent report on the state of capital access from the Manufacturing Extension Partnership (MEP) – a program of the U.S. Department of Commerce’s National Institute of Standards and Technology - shows a lack of available capital to manufacturers has “restricted the ability of many small manufactures to grow and compete.”  We’ve heard this and have developed new tools to support access to capital including a redesigned Supply Chain loan program (CAPLines) that provides low-cost, short-term financing to help small contractors and sub-contractors get the working capital they need to fulfill the contract, including creating jobs in the short-term. 

And finally, for those manufacturing small businesses that are poised for significant expansion and growth, the Small Business Investment Company (SBIC) program has been a great source of long-term, patient capital.  It had a record year in 2011, and over the past several years, more SBIC dollars from the debenture program have gone to manufacturing than any other sector. 

Through our continued work with the White House Office of Manufacturing Policy, the MEP, and many other partners, we will continue to help manufacturers create good jobs here over the long term.

About the Author:

Karen Mills

Former SBA Administrator

Karen Gordon Mills is the Former Administrator of the U.S. Small Business Administration. The SBA helps both Main Street and high-growth small businesses get access to capital, counseling, federal contracts, disaster assistance and more.

Comments:

Made in America goods and services are better than made in China, but Americans are used to cheap and inferior goods from China
Another thing is that A LOT of people have american pride. Yes, things that are made in America has a higher cost because things are cheaper to make over seas but I think people would always prefer to buy American if they had a choice. Even it was more expensive. Thats because when people think about American made, they tend to think about quality.
Manufacturing is so important for US jobs and I'd like to see more investment in US manufacturing. I do feel like the US is falling behind some of the emerging countries and this needs to be tackled.
It's fantastic to see that small firms employ one in three Americans who work in manufacturing! This is no small achievement.
Great post, thank you!
Nice article! Thanks for sharing. At least we see that many people are concern with our economic growth.
Very interesting and informative article. Our company have developed new concepts and new techniques regarding the global business , market entry, international trade and product development for the overseas market. we would like to share our ideas with interested U.S manufacrureres and investors who are willing to explore the lucrative business of the export business of Made In America venture. thanks, Al Mehanna/ Navistar Business Group.
Great Article.
Small and medium businesses are the engines of the national economy. The government policy should be even better for those businesses. When our economy grows, our lives will be better. Nice article :)
Small manufacturings was engine for global economical growth. They can produce unique product with high flexibility. These is a competitive advantage, more info. This post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Please note that Community members may include only one (1) link in their signature line. Thank you.

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