By Jeremy Field, SBA, for the Reporter
When it comes to growing the economy, we often focus on job growth through starting a new business. However, there is also a lot to be said about job retention and growth through transitioning current businesses to the next generation.
Our country has started riding the wave of the “Silver Tsunami,” the increasingly large number of baby boomers retiring. Research shows millions of baby boomers will sell or close their businesses during the next 10 years and 72 percent of them lack a succession plan. That is a substantial amount of jobs and valuable businesses at stake.
We are also experiencing a historic economic boom. In 2018, the economy outperformed expectations for the second year in a row and more than 2.6 million jobs were created. It was also the first time on record the number of job openings surpassed the number of unemployed workers.
During the past couple years, we’ve also seen policies and regulations shift into the favor of small business owners. For example, last year federal agencies issued 12 deregulatory actions for every new significant regulatory action, saving businesses $23 billion in regulatory costs.
The Tax Cuts and Jobs Act has also spurred business investment and productivity. Since 2017 capital expenditures are up $300 billion; and, business sector productivity grew nearly twice the rate of expansion prior to the tax cuts.
The booming economy and business-friendly regulatory environment combined with a wave of retiring small business owners creates the ideal opportunity for the next generation of entrepreneurs to purchase existing businesses. It is a rare and exciting moment in our economic history for innovative millennials and Gen Xers to build upon an existing business, take it to the next level and make their mark.
While the opportunity is ripe, it comes with a lot of questions. That’s where the U.S. Small Business Administration (SBA) and its network of resource partners and lenders come in. Whether it’s acquiring the financing to purchase a business, learning how to make the jump from employee to employer, or simply gaining the confidence and skills to be successful, the SBA is here to help prospective millennial and Gen X business owners with “the how.”
Conversely, our network can also help retiring small business owners create a succession plan and identify potential buyers to create a smooth transition for employees and clients.
In my role as regional administrator for the SBA, I have the honor of meeting entrepreneurs across the Pacific Northwest. I’m confident and optimistic the next generation of small business owners will continue the legacy established by our current small business leaders.
Jeremy Field is the regional administrator for the U.S. Small Business Administration (SBA) Pacific Northwest Region serving Washington, Oregon, Idaho and Alaska. The SBA empowers entrepreneurs and small businesses with resources to start, grow, expand or recover.