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Outlook for the '90s : For business, the 1980s were a period of enormous turmoil. A Japanese siege of the high-technology and auto industries, a surge and plunge in oil prices, massive failures of financial institutions and a fearsome stock crash. The 1990s don't promise much peace and quiet. Here's a look at what business faces in the next decade. : SMALL BUSINESS

January 02, 1990|JANE APPLEGATE

Small business became big news in the late 1980s, as massive corporate upheavals sent thousands of bright, talented people into the streets searching for opportunities. Many took an "I'll-show-you attitude" and opened their own businesses, boosting the U.S. small-business count to 17 million.

Small businesses create two of every three new American jobs, train two out of three new American workers and create more than half of U.S. technical innovations, according to Susan Engeleiter, administrator of the U.S. Small Business Administration.

"On the whole, 1989 was a positive year for small business, yet we need to build upon our successes in the 1990s," Engeleiter said. She said Congress must maintain a climate that encourages small-business growth.

"In an increasingly competitive global economy, we can't let Washington policy-makers dampen the spirit and success of America's entrepreneurs."

For the first time ever, small-business owners and their various trade associations united to defeat an unpopular measure. Their outcry forced the repeal of Section 89, a controversial portion of the 1986 Tax Reform Act. The section would have required employers to verify that their benefit plans did not discriminate between executives and rank-and-file workers. Tremendous and vocal opposition from small-business owners led to the repeal of the section by President Bush in November.

In 1989, Congress also helped small-business owners by reaching a compromise on the minimum wage issue by including a sub-minimum training wage that will help small businesses continue offering job training to young, unskilled workers. In 1990, small-business owners, who depend mostly on private money for investment capital, plan to lobby Congress for a reduction in the capital gains tax. A lower tax would stimulate investment by rewarding investors in small businesses.

Small-business owners, recently polled by the 560,000-member National Federation of Independent Business, expressed optimism for 1990. NFIB's survey revealed that small businesses are planning to buy more equipment, hire more people and provide better benefits for their employees in the future.

The SBA's 1989 theme, "Small Business Is America's Future," should reach far into the 1990s.

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