Question

Explain why small business is so important to the U.S. economy?

Answer 1

The small businesses in U.S. form a major part of the economy. Apart from their economic contributions, small businesses are also important because they contribute to growth in specific areas of socioeconomic development. Small businesses contribute to the well being in anumber of ways like they help in creating jobs for the less skilled and talented people who form the majority of the population of a country. The small businesses of a country help in promoting innovation. The trend for innovation is more evident in small businesses rather than large ones because the small businesses often offer environments that appeal to individuals with the talent to innovate new products and improve the management of the firm. The decision making process is fast due to less number of levels of management which also gives way to a more transparent performance reward system. The small businesses have a major role to play in providing opportunities to women and minorities. This has helped them in achieving financial success and independence.