When I arrived in Georgia in May 2002, I quickly sensed that I had landed in the most entrepreneurially oriented place among my various tours of duty with the U.S. Small Business Administration. Many people I encountered, even casually, were thinking about starting a business, were starting a business or had an established business. Even individuals who held traditional jobs also operated their own enterprises. Statistics have supported my initial observations. Ninety-five percent of the businesses have fewer than 50 employees, with 87 percent employing five or fewer individuals. The Kauffman Foundation ranks Georgia second among states for increases in entrepreneurial activity over the past decade. The Atlanta-Marietta-Sandy Springs Metropolitan Statistical Area tied for second nationally in entrepreneurial activity among metropolitan areas.
Why is small business and entrepreneurship so prominent in Atlanta and Georgia? One of the biggest drivers is demographics. Between 2000 and 2010, Georgia’s population grew 18.3 percent and was one of only six states that experienced a population increase of more than 1 million people. Metro Atlanta was the country’s third fastest growing area during this period, with a 24 percent population increase.
An increasing population brings increasing customer demand for products and services, which, in turn, generates more opportunities for new and existing businesses. The age of the population also promotes higher levels of entrepreneurial activity. In Georgia, 63.3 percent of the population is between 18 and 64 years old, the age segment from which the vast majority of entrepreneurs comes. That percentage rises to 70.8 for Atlanta. Education levels, which have been correlated with business ownership, are also favorable, with more than 27 percent of Georgians and 45 percent of Atlantans having at least a bachelor’s degree.
Georgia has key economic generators that spur opportunities for business ownership and entrepreneurship. There are the obvious ones — Hartsfield-Jackson International Airport, the world’s busiest airport, and the Port of Savannah, the fastest growing port in the country.
These facilities are important bricks in the foundation of the state’s economic infrastructure. They draw companies of various sizes to the state and encourage new ventures. The presence of headquarters for 30 Fortune 500 and 1000 corporations in Georgia generates business opportunities for smaller businesses through their respective supply chains and ancillary activities. The state’s military installations are also sources for small-business opportunities. An emerging agritourism sector is creating more enterprise opportunities in rural Georgia.
Overall, Georgia and Atlanta consistently rank high for a pro-business environment having relatively lower taxes and regulatory requirements, lower cost of living and higher quality of life.
There is a more balanced approach to economic development policy at state and local levels by including business development along with business recruitment and retention. Entrepreneurship education is available from the state’s technical colleges as well as academic colleges and universities to foster the creation of traditional, lifestyle and high- growth “gazelle” businesses.
This week marks the 49th observance of National Small Business Week. It is an opportunity to celebrate the role of small businesses and entrepreneurs in the American economy and culture.
The past few years have been challenging with the most severe recession in a generation. Although the rate was lower during that period, we did see some entrepreneurs starting businesses. Many existing business owners found ways to reinvent their companies to survive in the short term and set the stage to be stronger and prosper in the long run. In Atlanta and across the state, small businesses have played a significant role in our economy and will continue to do so.
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Terri L. Denison is Georgia district director for the U.S. Small Business Administration.
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