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Small businesses take third-quarter beating

By Maxine Shapiro, KERA 90.1 business commentator

Dallas, TX – Over the last two years, there wasn't a big business who didn't feel the pains of the economic downturn. But how battered were the small businesses? I'm Maxine Shapiro with KERA Marketplace Middays.

According to Huntley Paton, publisher of the Dallas Business Journal - pretty battered. The Network of City Journals, an affiliate of the Dallas Biz Journal, conducts ongoing studies on the national trend in small businesses. Their latest, released last week, was conducted at the end of the last third quarter.

Since the end of 2000, there are now 100,000 fewer small businesses. Ouch. Women-owned businesses got hit the hardest. This is one number we didn't want to see go backwards. Two years ago, women-owned businesses made up 40% of all small businesses. Today - only 32%. Minority-owned coped a little better. They lost no ground on their 9% piece of the pie. And that number should be higher anyway.

There are still over 7 million lucky small businesses that got to keep their doors open. And the average annual growth rate is nonetheless pretty impressive - almost 15%. But that's down over 4% from two years ago.

And the one item that's keeping the small-business owner up at night is the same thing that's keeping most of us up - health care and how to pay for it. Today, only 52% of the owners can provide health insurance for employees - down a whopping 8%.

But oh, the entrepreneur is a resilient breed. One in four are still growing 10% every year, while one in five over 20% - a figure a few big businesses owners would be envious of.

It didn't always take a degree to run a small business, but intelligence was a necessity. Now, Paton points out "there has been a sharp increase in the number of college-graduates" taking the path of entrepreneurship. It's a scary path if you're not cut out for it. I believe Sir Winston Churchill said it best: "Success is the ability to go from failure to failure without losing your enthusiasm." For KERA Marketplace Middays, I'm Maxine Shapiro.

Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 p.m. To contact Maxine Shapiro, please send emails to