Growing small businesses and taking local initiative were messages expressed by Wendell Bailey, former state treasurer and outgoing advocate for the Small Business Administration (SBA), at last week's meeting of the Monett Kiwanis Club.
Bailey, a Republican, remains on duty with the Small Business Administration in Kansas City, serving a four-state region, until a new head advocate is named in Washington, D.C. Bailey has continued his travels around his territory and spoke about a number of initiatives underway to promote business growth.
"Two-thirds of new jobs are created by small business. Over half of all patents are created by small business," Bailey said.
Initiatives that help small businesses will be among the most productive in helping the current economic situation, according to Bailey.
Historically the SBA has guaranteed from 75 to 85 percent of loans to businesses that qualify. In the current economic situation, that has not been enough to secure loans for many firms, Bailey said. In calendar year 2008, SBA-backed loans were down by 30 percent because banks did not want to risk losing the 10 to 15 percent of the loan that remained their responsibility.
The SBA has several types of loan offerings to help businesses, Bailey said. There are even short-term loans made possible under the federal stimulus package where SBA guarantees the entire loan. In the first quarter of 2009, Bailey said loan activity has revived somewhat but has still not returned to the levels of one and two years ago.
Unlike many programs, SBA focuses on areas that lack resources to stimulate development. Bailey spoke about a 10-county area in south central Missouri that has the lowest per capita income in the state. In Wayne County, for example, 40 percent of adults have not finished high school. In Shannon County, the average income for a family of four is $20,400, the lowest in the state.
Bailey said he has started a 503(c)3 not-for-profit corporation to stimulate job development in south central Missouri. The Senior Corps of Retired Executives, based in Springfield, is committing the resources of very experienced businessmen who are donating their time to guide once businesses in the area forward.
Logistical obstacles offer areas where SBA can help significantly, Bailey said. He talked about getting containers that ship on flatbed railroad cars out to small businesses, rather than forcing the firms to get their products to major shipping points like St. Louis before getting access to the containers. A Willow Springs wood factory provides walnut for the dashboards of Lexus automobiles because of access to shipping possibilities, Bailey said.
SBA is also working on expanding access to broadband high speed Internet service for rural areas. Bailey said the ability of customers to find producers over the Internet is helping a free-range chicken farmer, goat and sheep farmers and a Shiitake mushroom producer sell what the company grows in rural Missouri to distant markets.
Growing businesses locally has proven to be much more effective than "chasing smoke stacks" to bring out-of-town firms into a town., Bailey said. Monett has done that by the example of Jack Henry and Associates, added Bailey.
Having career education available is also critical. Bailey said people in Eminence have to drive 90 minutes to West Plains to get the kind of career opportunities Monett has available at the Southwest Area Career Center.
Bailey talked about forming closer alliances between businesses and schools to get more money into education on a local level to secure specific training for jobs. He also encouraged community partnerships between residents, businesses and schools to move local economies forward.
"We can revitalize the economy by local activity," Bailey said. "Small business can be part of the revitalization of America."
In Kiwanis Club news, Vice President Frank Washburn urged members to volunteer to cook for the Chamber of Commerce's prayer breakfast on May 7. Randy Johnson offered a reminder that Kiwanis Night with the Springfield Cardinals is on July 16. Tickets are $23.50.
The Monett Kiwanis Club meets on Tuesdays at noon at Happy House restaurant in Monett for a meal and a program.