Carolina Small Business Development Fund
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Research Conducted by The Support Center Shows Impact of $19.5 Million in Loans Made to Small Businesses in the State of North Carolina
RALEIGH, N.C. (July 7, 2016) — Policy research conducted by The Support Center, nonprofit and state-wide small business lender, shows the economic impact of 228 loans, totaling $19.5 million, it made to Main Street small businesses across the state.
With 87 percent of businesses in North Carolina having fewer than 20 employees, small businesses are critical for North Carolina’s economic vitality. Small businesses create more jobs during economic downturns, as compared to large businesses, making them important for local economic resiliency. Research shows that this is especially true for local, “homegrown” small businesses.
In the report, The Economic Impact of North Carolina’s Main Street Small Businesses, The Support Center analyzed the economic impact of the 228 loans, totaling $19.5 million, which it made to small businesses between 2011 and 2015. These businesses were in a range of industries and created or retained 742 jobs throughout the state. Using input-output analysis, which measures the ripple effects of these loans in the broader economy, the study showed that TSC’s investment generated economic activity that would not have otherwise occurred in North Carolina.
“North Carolina is home to more than 800,000 Main Street small businesses. They are the driving force of our local and state economies, yet their capital needs have not been addressed in the state’s economic development strategy,” said Lenwood V. Long, Sr., President and CEO of TSC. “Since 2010, we have funded over 418 small business loans, totaling $29.8 million, which have supported over 1,018 jobs. As we help small businesses grow and succeed, we are also strengthening and growing the state economy. We provide small businesses with capital and business services that help them thrive in North Carolina. That’s why we’re here.”
The Economic Impact of North Carolina’s Main Street Small Businesses report found the following:
- For every one job created by a small business that TSC invested in, another 1.13 jobs were created in the North Carolina economy.
- The investments made by TSC that resulted in small business job creation generated an additional $7 million of income for North Carolina’s workers.
- The investments made by TSC that resulted in small business job retention saved $2.6 million in income for North Carolina’s workers that otherwise would have been lost.
Despite their impact, small businesses face barriers in accessing resources and capital to startup and grow their businesses. Bank lending to small businesses decreased by half between 2003 and 2014. Community Development Financial Institutions (CDFIs) like TSC have stepped in to bridge the capital gap for “Main Street” small businesses. CDFIs’ mission to reach businesses underserved by traditional capital markets and to provide ancillary business supports ensures long-term business success and provides a safe and affordable source of financing for small businesses.
The following are policy recommendations that focus on solutions to support the growth and development of small businesses in North Carolina. These recommendations, based on successful models implemented in other states, include:
- Establishing a state revolving loan fund for small business lending
- Piloting a state small business guaranteed lending program
- Establishing a vehicle to harness and pool investments from banks, corporations, and others for CDFI small business lending.
To download a copy of the full report, please visit the Carolina Small Business website at www.carolinasmallbusiness.org/impact/policy-research or email VP of Policy and Research, Sadaf Knight at firstname.lastname@example.org.
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About Carolina Small Business Development Fund
Carolina Small Business Development Fund, formally known as The Support Center, has a mission to foster economic development in underserved communities by providing capital, business services, and policy research to support small businesses. Since 2010, Carolina Small Business has invested more than $30 million through 449 loans to small businesses across North Carolina helping to create or retain more than 1,018 jobs. www.carolinasmallbusiness.org
For more information about Carolina Small Business, please contact Marketing and Communications Associate, Janice Rojas at 919.803-1437 ext. 232 or email@example.com.