Help for Small Businesses

A legislative panel has been examining issues of concern to smaller companies in Virginia—with a goal of recommending policies that will help them expand and promote hiring.

One focus of the Small Business Commission has been on the small-, women-, and minority-owned firms that are awarded contracts to work for the state.  While the number of SWAM companies has grown, most are quite small—and the program may still need some fine-tuning.

Thanks to ambitious outreach efforts, nearly 21,000 small-, women-, and minority-owned businesses are now state-certified.  Department of Minority Business Enterprise Director Ida McPherson told the Commission that the number of companies owned by women and minorities that conduct business with the state has significantly increased.  However, companies defined as “small” businesses with up to 250 employees still win many contracts—although firms with 16 or fewer employees actually create more jobs.

“So when you’re trying to create new jobs, you’ve got to get the money where those businesses are—because if they take on a new project of a $100,000, they immediately go out and hire someone.  If you take a firm that is at 250 employees and they’re making $50 billion, if they bid on something—a $250,000 project—they don’t need to hire anybody else.  They just squeeze it within what they currently have.”

McPherson said one option may be to target more contracts toward the subset of companies with fewer employees.

-by Anne Marie Morgan

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