Resource Utilization among Black Small Business Owners in Detroit: Results from a Questionnaire
One of the most important ways for small businesses to access capital is through connections to resource networks. Business networks are the set of arrangements and information platforms that business owners use to increase exposure and sales, gain knowledge of their markets, develop financial management skills, and familiarize themselves with sources of financing. Networks can also connect people to other service providers, such as nonprofit organizations and professionals that support business owners through technical and financial training, referrals, legal services and procurement ...
COVID-19 and SME Failures
We estimate the impact of the COVID-19 crisis on business failures among small and medium-size enterprises (SMEs) in seventeen countries using a large representative firm-level database. We use a simple model of firm cost minimization and measure each firm’s liquidity shortfall during and after COVID-19. Our framework allows for a rich combination of sectoral and aggregate supply, productivity, and demand shocks. Accommodation and food services; arts, entertainment, and recreation; education; and other services are among the sectors most affected. The SME jobs at risk due to business ...
Measuring Small Business Financial Health
Throughout the Great Recession and continuing into the recovery, small businesses have played an important role in creating jobs and stabilizing communities. Stories of small business owners overcoming obstacles to provide valuable services and employment are highlighted regularly by pundits, politicians and policymakers alike. However, little attention has focused on the question of what drives the financial health of these often young, often very small businesses.
Firm Entry and Employment Dynamics in the Great Recession
The 2007-2009 recession is characterized by: a large drop in employment, an unprecedented decline in firm entry, and a slow recovery. Using confidential firm-level data, I show that financial constraints reduced employment growth in small relative to large firms by 4.8 to 10.5 percentage points. The effect of financial constraints is robust to controlling for aggregate demand and is particularly strong in small young firms. I show in a heterogeneous firms model with endogenous firm entry and financial constraints that a large financial shock results in a long-lasting recession caused by a ...
Panel Remarks: The Fed and Main Street during the Coronavirus Pandemic
Panel Remarks at The Fed and Main Street during the Coronavirus Pandemic, WebEx event, April 23, 2020.
The Impact of COVID-19 on Communities and Small Businesses
Speaking at a Fed webinar, Philadelphia Fed President Patrick Harker said small businesses, and those owned by minorities in particular, are among those most economically impacted by the COVID-19 crisis. Harker said one solution to help create a stronger small business sector could be to ensure that more small businesses and microenterprises have relationships with banks.
Small Business Performance in Industries in LMI Neighborhoods After the Great Recession: Atlanta, Baltimore, Chicago, Houston and Los Angeles
Small businesses are essential to the economic infrastructure of both lower-income and higher-income neighborhoods. In this report, we compare small business performance in lower-income vs higher-income areas. Findings offer some directions for growing small businesses in LMI and ethnic/minority neighborhoods
Tools (Lessons and Strategies) Toward Market Restoration: A Conference Summary
Community development post-recession takes place in an environment that is greatly changed in terms of both demand for and capacity to deliver services. While no community was immune, the places that were most deeply affected by the Great Recession ? and continue to feel its effects ? are often those places that had suffered from disinvestment for decades leading up to it. The tools and strategies that have been developed and relied on by investors, practitioners and advocates ? in some cases for decades ? need to be adapted to the changes, while continuing to meet ever growing demand.
Spotlight on Research: The Role of Small Businesses in Commercial Corridor Revitalization
Revitalizing the commercial sector in inner-city neighborhoods that have deteriorated is fraught with issues concerning, among others, the appropriate retail mix and location of establishments, as well as the impact of such efforts on residents and consumers. A key decision is who will serve as the prime mover for the revitalization activities. An article by Stacey Sutton takes a slightly unorthodox view by suggesting that small business owners are underexplored stakeholders who could spearhead a retail restructuring campaign. The following is a summary of the case she makes to support this ...
Do Entrepreneurs Pay to Be Entrepreneurs?
Some small-business owners are motivated more by values than financial gain