SMEs are a huge part of any economy. Not only are they the lifeblood of the financial economy, but they also provide a huge number of jobs and help to give many people their livelihoods. Having a healthy small business sector is essential if any country want to have a healthy and vibrant economy. A report released by the Federation for Small Businesses has shown what an impact small and medium businesses are having on the economy, making it all the more important for SMEs to have access to finance in order to grow more and provide more jobs.
Reducing unemployment figures is one of the big goals of the government, and the role of SMEs in this task has been revealed by the report by the FSB. Firms with less than 250 employees take on about 1.3 million unemployed or disabled people each year. Contrast this with firms of over 250 employees and the impact is clear – whereas you might expect bigger companies to take on more unemployed people, in fact they hire less than 130,000 on average each year. The small business sector is clearly doing more than its fair share when it comes to boosting local economies and creating new jobs.
Small companies have a greater tendency to take on those who might otherwise struggle to find a job – students, long term sick and disabled people are more likely to be employed by small as opposed to large businesses. However, this ability to take on new employees often relies on companies’ ability to get access to funding to allow for growth. With the banks often unwilling to lend, and with big business benefiting more from schemes such as Funding for Lending than small businesses, it can often be tricky. Thankfully, alternative finance such asinvoice factoring could help. With the cash flow boost provided by invoice discounting or factoring, your business may have scope to help create even more jobs. Small businesses play a vital role in our economy so its vital they continue to grow and flourish – with invoice finance, that’s definitely possible.