Small firms are big in city, area economy

2/16/2002

Lots of area residents don't have very many co-workers.

About half of the business establishments in area counties have one to four employees, according to the U.S. Census Bureau. Many of those plants and offices are branches of larger operations, but a significant number are independent, small businesses.

In many such businesses, two or three generations of a family are involved in operations, said Linda Bowyer, director of the small business and entrepreneurship institute at the University of Toledo.

The recession has affected more small businesses than larger industries because more small ventures operate on a shoe-string, said Bruce Lee, executive vice president of Fifth Third Bank. Especially since Sept. 11, many businesses have needed to dig into reserve funds. For many businesses, recent months have been the hardest in more than a decade, experts said.

But the economy hasn't diminished the number of people who at least investigate starting their own business.

“Maybe I'd have a little more job security if I'd pilot my own boat,” Ms. Bowyer said some of her clients tell her.

Others just appear to want to work for themselves, feeling that, even if they work longer hours and earn less, they'd be happier.

Down markets present opportunities for such entrepreneurs. It's less expensive to borrow money and real estate costs - which for years have been less in Toledo than many cities - are lower in some cases.

However, lenders, who traditionally are more leery of small business loans, have become nervous, Ms. Bowyer said.

Local counties have long been more dependent on small businesses and small branches of larger organizations than many areas of Ohio and Michigan.

Only 32 work sites employed more than 1,000 people in 19 area counties in 1999, the most recent year that U.S. Census records are available. That same year, Franklin County (where Columbus is) had 40 and Cuyahoga County (where Cleveland is) had 48.

Throughout Ohio, there were 297 sites had more than 1,000 employees. Michigan had 250 that year.

Of the 11,225 workplaces that the census counted in Lucas County, almost 10,500, or 93 percent, employed fewer than 50. At the time, 12 employed more than 1,000.

Hancock County had four sites employing more than 1,000 and Monroe County had three. But most northwest Ohio and southeast Michigan counties had only one or two such sizeable workplaces and several - including Ottawa, Paulding, Seneca, and Williams counties - had none.

Nevertheless, many of those small plants and offices are dependent on the fortunes of the region's largest businesses, particularly in the auto industry.