Thursday, June 2, 2016

Small Business and Services Lead the Improving Economy

The ADP National Employment Report recently released its private sector employment data for April to May of 2016. Small business business is leading growth while services are taking over a larger share of offerings. The report could be hinting at larger geopolitical shifts that are making footprints.

 Small business hired 76,000, medium size 63,000 and large 34,000 employees. The change shows that small business is a proper focus of public interest. As we encourage small business to grow and develop we can create more innovation in society that leads to further employment.

We often focus on large corporations in our government decisions. They donate to campaigns and seek to create influence. Yet they are not the big employers nor are they the ones that change the market. Their advantage lies in their pooled capital and global penetration. You will also find in the report a change of employment of 175,000 in services and -1000 in manufacturing goods.

 The change could be an indication the country is moving more towards services industries and becoming less competitive in manufacturing. Manufacturing is an important part of building a solid middle class. It is hard to compete against foreign countries that have cheap access to labor and resources. However, by building stronger competitive regions we can create fundamental changes in the potential development and long-term success of our manufacturing industries.

The employment data only represents the time frame it was measuring but could indicate some broader changes. The environment is right for smaller service oriented business based on highly educated and experience professionals. Larger manufacturing companies will need to find competitive clusters where they can innovate and improve efficiency beyond their competition.

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