It may surprise you to learn that if just one third of New York City's very smallest businesses, with five employees or less, added just one employee, the city would instantly have 55,000 more jobs.
But if that sort of math leaves you just short of breathless, well, you have the Center for an Urban Future to thank. Its point, from a study entitled Small Business Success, released this week, is a bit more profound.
Namely, that the smallest businesses in New York City are the biggest job creators, but they're being held back from growing by forces and policies almost any entrepreneur can relate to. Among these are high taxes, too much regulation, and the high cost of city life, Jonathan Bowles, the executive director of the Center, and co-author of the report said in a recent WNYC interview.
"We need to make sure more of our great small businesses grow into medium-sized and large business," Bowles said.
Here are a few main findings from the study:
- More than 90 percent of New York City businesses had fewer than 20 employees.
- Businesses with fewer than five employees had a net gain of 31,421 jobs between 2000 and 2013, compared to a net loss of 5,022 jobs for businesses with more than 500 employees.
- Eighty-two percent of business job growth between 2000 and 2013 occurred in firms with fewer than five employees.
The Center has a long list of policy objectives to help these very small businesses grow. Among those is improving their access to large corporate contracting opportunities, as well as government procurements. In addition, the Center suggests becoming more tech savvy and helping immigrant-owned businesses expand beyond serving just their own ethnic communities.
But for a reality check with a real entrepreneur who called into WNYC to discuss the report's findings, it's the high cost of living in the city that's really holding her back.
Liz Turrigiano, a co-founder of cloth diaper service Diaperkind, said her 15-employee company is bursting at the seams of its 2,500 square foot facility in the Gowanus section of Brookln. But rent for commercial space is so as astronomically high, expanding is a challenge.
"We need more space, but rent around Brooklyn has skyrocketed," Turrigiano says.