Business Atlanta small-businesses have ‘bright future,’ economist says

BY JANELLE WARD

Atlanta is one of several economies based across the Southeast that appears to thrive from a small business perspective, even in the midst of widespread layoffs, inflation and previous national concerns over a possible recession.

The city has witnessed a surge in privately managed small and medium-sized enterprises over the past few years, contributing to a small business scene that has evolved into an influential sector of its own, making up a significant portion of the overall economy.

Liz Wilke, principal economist at Gusto, a producer of payroll and benefit-management software that helps small and mid-sized businesses operate their ventures, said that Atlanta joins the ranks of Nashville, Charlotte, Jacksonville and a handful of other steadily-growing cities in showing signs of firmness that could lead to increased financial prosperity in the future.

Using data gathered from the businesses acquiring the company’s services, Gusto’s economists analyze current trends in the small business sector across multiple metrics and regions and predict future conditions to better assist their clientele. According to accumulated data, Wilke said that metro areas across the Southeast have maintained a steady rate of employee dismissals overall, the firing or laying off of workers usually during times of downsizing caused by fluctuating demand.

“Other regions have seen a little bit of cooling, mostly driven by lower hiring, but also an uptick in dismissals,” Wilke said. “But we really have not seen that in the Southeastern region.”

Instead, metro Atlanta’s small businesses are choosing to hold onto the employees they’ve already recruited, as opposed to hiring additional talent in the midst of nationwide economic uncertainty. Wilke said that this stagnation, along with calming inflation and the persistent recovery of the global supply chain, has helped small business owners find stability in their practices, giving them a chance to prepare for future growth.

Following the pandemic, workers have exhibited an increased interest in forging their own small businesses and startups, drifting from the traditional 9-to-5 model in exchange for a work culture that allows for a more favorable work-life balance. The overall volatility of the labor market has also prompted workers to turn to “solopreneurship,” or the opportunity to pursue a personal passion and become their own bosses.

Entrepreneurship gives workers a chance to do away with the aspects of the conventional corporate workplace that have proved unpopular among many demographics of employees, which has manifested into attempted four-day work weeks and increased opportunities for hybrid and remote working. With small businesses, employers are able to create a more flexible and personable work environment that makes it easier to value employees, and, as a byproduct, yields stronger retention rates among workers.

“There’s all these headlines about big tech companies laying folks off because they’ve overhired and they’re making corrections. But we, in our data, don’t see that uptick in dismissals for small businesses and small business tech, in particular,” Wilke said. “They are playing a role in economic stability that I think is unique and evolving and different from what we previously expected of small businesses.”

While small businesses have historically served as the backbone of America’s economy, they have progressed to have a much larger impact on the economy as a whole. It’s the small business sectors within mid-sized markets that have witnessed some of the most impressive growth over the years, fulfilling a need for additional jobs in local economies and helping change the definition of success for workers in the country.