Chart I. CHANGE IN ANNUAL AVERAGE NUMBER OF BUSINESS FIRMS, TABLE 2.-Number of firms in operation, new businesses, and discontinuances 1 Although A and B are not comparable, it is possible, however, to get from A a rough idea of business turnover in the earlier years. 2 Revised series. 3 Preliminary. Source: Survey of Current Business. 619, 800 226, 400 472, 800 291, 800 394, 600 373, 600 358, 300 403, 100 A large percent of all retail trade and service establishments and contract construction firms are small. Since these are increasing in number, the number of small firms have also grown since 1929. The difficulties confronting small business enterprises are important. They also have certain advantages which should be fully recognized. Many people believe these advantages should be maintained. This attitude has been summarized as follows: 21 "From the evidence submitted to the subcommittee it seems clear that one of the important questions facing the American people today is to determine what steps can and should be taken to preserve an open door for investment in little and local business in terms of ownership as well as in terms of debt. That problem is paramount to the development of a steadily expanding economy." Size and distribution of respondents Since the remainder of this discussion will concern itself primarily with results obtained from the questionnaire, it seems desirable at this point to present data which will indicate the size, type, and location of the industries represented in the response to the questionnaire. The importance of small business in the American economy is well recognized. It is equally well known that small business is faced with definite financial and managerial problems. The lack of specific data on the financial needs of small business and the desire to better understand the position of small business were basic facts underlying the questionnaire survey by the National Association of Manufacturers. The questionnaire was designed to elicit facts and opinions from manufacturers regarding their experience, current and past financial needs and requirements, and what the Government had done or could be expected to do to aid small business. More specifically, the members were asked to indicate the type of business, the form of organization, the number of employees, the firm's net worth, the amount of funds needed (if any), and the geographical location of business firms. Of the 3,221 respondents to the questionnaire who gave their size, 27 percent had less than 50 employees, nearly 48 percent had 100 or less, and 73 percent had 250 employees or less. Only about 15 percent of the respondents had 500 or more employees. A distribution of the respondents based on the number of employees is presented in Table 3. TABLE 3.-Classification of respondents by number of employees 1 Excludes 13 cases which either did not report employment or reported that employment "varies." 21 Volume and Stability of Private Investment, report of Subcommittee on Joint Committee of Economic Report, S. Con. Res 26, 81st Cong., 2d sess., S. Doc. No. 149. Government Printing Office, Washington, 1950, p. 7. TABLE 4.—Geographical distribution of respondents compared with all manufacturers 1 Excludes 10 firms from Hawaii and 36 firms which did not supply this information. The respondents to the questionnaire were widely distributed geographically. There is a high concentration of industry in the Mid-Atlantic States, East North Central States, Pacific States, New England, South Atlantic, and the West North Central States according to the United States Census of Manufacturers. The distribution of the respondents to the questionnaire geographically compare favorably with that of the census. (See table 4 and chart III.) TABLE 5.-Classification of respondents by net worth |