Small businesses are on a bit of a downward spiral.
Their sales have plummeted to a 17-year low and their profits have shrunk by a staggering 25 percent.
But with the economy still recovering from the worst recession since the Great Depression, there’s a good chance that the downturn will last much longer than most of us imagine.
According to the National Association of Realtors, there will be more layoffs this year than at any point in the past 30 years.
And that’s before you even factor in the fact that the government has put in place a slew of rules designed to make it harder for small businesses to compete in the booming markets of the new millennium.
“The bottom line is, the industry has been hit harder than most people have in the last 30 years,” said Richard D’Alessandro, president of the National Federation of Independent Business.
“It is very difficult for businesses to survive in the current environment.”
The good news is that small businesses are still a major source of jobs for Americans.
More than 3.2 million people work for small business in the U.S., according to the Economic Policy Institute, and the majority of them work in the retail, hospitality and food services industries.
Many of these jobs are filled by people who have already been laid off or who are considering leaving.
But the good news isn’t that small business is in such a good position.
The good job growth is going to come from the other side of the coin: those who are doing well are not going to be able to afford to keep the same wage-earners as before.
“The small business industry is not going anywhere,” said David Weiler, chief economist at the American Enterprise Institute.
“That’s not going away.”
And it’s not only the employees who are going to suffer.
Weiler and his colleagues have calculated that if the current labor market trends continue, by 2023 the labor force will shrink by 16.3 million people, or a quarter of the population.
“When you look at the trends in the labor market, you start to get a picture of where we are headed,” Weiler said.
As we know from the economic data, small businesses and their employees are facing the most significant challenges in our nation’s history.
So, what’s going to happen to the small business community as a whole?
One way to think about this is to look at what happened in the aftermath of the Great Recession.
After the collapse of the housing bubble, many small businesses struggled to survive as they struggled to compete with the fast-growing real estate market.
In many cases, they struggled even harder to find enough people to fill those jobs.
These companies found that it was possible to make ends meet by hiring part-time employees and then firing them when they had enough people.
This was an extremely difficult and inefficient way of doing business.
It was also a major contributor to the loss of jobs in the small and mid-size businesses, which were often left with a large number of empty positions and no jobs at all.
Today, most small businesses don’t have the same kind of problems that they had during the Great Collapse.
That’s partly because they have more employees, which means that they have a larger pool of people willing to fill the positions that were once filled.
However, it’s also because there are more people in the economy today than there were in 2008.
Even if the employment figures are slightly higher now, it will still take time for most small business owners to find a way to survive the downturn.
If you or anyone you know is considering working in a small business, be sure to ask them about the challenges ahead.
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