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Opinion: Despite challenges, entrepreneurship rising

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The last two years have been challenging to all of us, but small businesses have bravely risen to meet the moment, many with assistance from the Small Business Administration’s COVID-19 relief programs. The local office of the SBA routinely meets with small-business owners, and they consistently tell us there are five major pain points affecting them. Supply chain issues, the rising cost of inventory, inflation, labor market troubles and managing remote employees are the primary challenges local small-business owners commonly report.

However, there is good news as local data show a growing number of businesses in Greene County.

The challenge
Global supply chains continue to cause supply shortages and when supply shrinks, the price of goods increases. Additionally, inflation affects both households and businesses as the cost of goods continue to rise.

Small employers also are experiencing labor market issues. According to the U.S. Bureau of Labor Statistics, as of December 2021, the unemployment rate in Greene County was 2.1%, the lowest rate since October 1999. Employers report it is not uncommon to post a position and receive zero applicants.

The labor shortage has led to rising wages as employers need to increase wages to both recruit and retain staff. Supply chain issues, inflation and employee costs are all added costs for small businesses. While working from home was uncommon prior to the pandemic, it has now become normal. Studies show that prior to the pandemic, one out of every 67 jobs was virtual. It is now one out of seven, and many small businesses report struggling with managing a remote workforce.

Maintaining productivity while not being able to physically meet with your employees presents new challenges to many small-business owners, especially those in the service industry.

The resilience
Notwithstanding the challenges, entrepreneurship is on the rise in Missouri.

The SBA’s Office of Advocacy reports there were 530,380 small businesses in Missouri in 2020. In 2021, that number grew to 542,519. Business licenses in Greene County grew 22% between 2018 and 2021.

While not every business needs a business merchant license to operate, the increase demonstrates that the number of small businesses is growing.

Also, the number of SBA-guaranteed loans approved to Greene County small businesses increased by 8% in the latest three months of reporting data through January, compared to the same period the prior year.

Feedback from lenders indicates that lending to small businesses will continue to grow as the recovery continues.

These factors point to an improving business environment and continued growth for small business in the Greene County area. Our resource partners report a renewed uptick in requests for new business counseling, and American entrepreneurs have always demonstrated incredible resiliency and innovation to meet challenges.

Krishin Thadani is an outreach and marketing specialist with the U.S. Small Business Administration’s Springfield branch office. He can be reached at krishin.thadani@sba.gov.

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