Michigan’s entrepreneurial economy continues to grow as small businesses have weathered the post-Covid era, according to the Entrepreneurship Scorecard released today.
The 18th annual scorecard, released by the SBAM Foundation, analyzes the state’s economy to gauge Michigan’s entrepreneurial climate.
“While many challenges persist, it’s safe to say that small businesses in Michigan have seen significant improvement since the start of the pandemic and in the past 18 years since the development of the scorecard,” said SBAM President and CEO Brian Calley. “While inflation and labor shortages are threats to the future, small business revenue trends and startup trends provide cause for optimism.”
The economic conditions identified in this year’s scorecard include:
Michigan Economy Holds Strong in 2021-22: Category 1 for 3-Month Economic Improvement in 7 of the Last 9 Months
Michigan’s small businesses have outperformed the United States since 2020 (measured by percentage growth in public businesses and business revenue)
Spending and consumption remained strong, along with unusually strong state sales tax collections
New business start-ups have been particularly robust since the second half of 2020 and the 5-year small business survival rate has started to increase.
The scorecard also identified pressing issues facing small businesses and entrepreneurs in 2022, including:
Percentage employed and labor force participation has declined since before the pandemic
Growth has slowed since the recovery began in mid-2020, and job opening growth in Michigan has been somewhat below the US average.
Inflation is the number one issue facing small businesses in 2022. 41.9% of small businesses in Michigan are facing large/severe price increases (40.6% in the US)
Affordable housing in safe and pleasant communities is part of the challenge. As Michigan ranks in the top five states for home ownership, housing has become an important factor in stabilizing and improving low/moderate income neighborhoods and quality of life.
“While Michigan’s small businesses have clearly played an important role in Michigan’s economic growth, we cannot take their success for granted,” Calley said. “Our policymakers must be careful not to throw a wet blanket on small business success with policies that stifle new business start-ups with limitations on independent contractors or further exacerbate cost increases with additional government mandates.”
The full Score Care report can be downloaded at //www.sbam.org/scorecard.
The Small Business Association of Michigan is uniquely focused on serving the needs of Michigan’s small business community through advocacy, collaboration, and buying power. Today they serve more than 30,000 members in all 83 counties of Michigan. SBAM is located in Lansing, just one block from the Capitol.
