Small Businesses – Bigger Voice?

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Ballard

During Seattle’s debate about the minimum wage, the University of Washington published a report that included compelling data that never seeped through the sloganeering.

In 2012, according to state records cited by the UW report, 75% of all Seattle employers had fewer than 10 workers each. That percentage of micro-to-small employers grows to an astounding 94% if you include firms with fewer than 50 employees. Among those companies, the average employment rate works out to 6.7 workers each.

This segment of the business community is comprised of more than 25,000 firms and it is pervasive if you live, walk, shop and/or work in Seattle neighborhoods.

Every commercial avenue is lined by their front doors and shop windows. Owners and co-workers are often indistinguishable as they provide coffee, books, groceries, hardware, lunch, dinner, breakfast, gifts, jewelry, pet jewelry, part-time jobs, summer jobs, starter jobs, retirement-supplementing jobs and friendly chats with others who call Seattle home.

Fat cats? Alley cats might be a better comparison. The small and tiny businesses are usually owned by people who invest more sweat than equity in their enterprises. Obscene profits? The more common curse at these companies is “no profit.” Survival is seldom a given and paydays often trigger emotional riptides of relief from making payroll.

Yet, while these companies form by far the broadest part of Seattle’s business base, we suspect that they often fail to receive due consideration in the formation of business regulations.

Short shrift in the cubicles of power is not necessarily malicious. It’s more that small businesses occupy a universe of realities not usually shared by those with career paths that culminate in the public sector with its abundant job security and generous job benefits.

But, could small businesses gain a larger voice at City Hall?

That might be a possibility in 2015 as the city enacts a new system for electing city council members from geographic districts within the city.

This will be a topic for discussion at the Manufacturing Industrial Council meeting Tuesday, February 24, 3:30 to 5:30 p.m. at the Georgetown campus of South Seattle College.

The meeting is the first in a series of MIC forums in the months ahead featuring Seattle City Council incumbents and challengers. Candidates will be augmented Feb. 24 by guest speakers Frank Blethen, publisher of the Seattle Times, and Times editorial page editor, Kate Riley. They’ll lend historic perspective regarding the political evolution of the Emerald City.

Candidates scheduled to appear are Dave Monture, a West Seattle restaurant owner campaigning to represent City Council District 1, including West Seattle and Harbor Island; Catherine Weatbrook, facilities manager for the non-profit Crown Hill Center, running in Council District 6, including Ballard; and John Persak, a member of Local 19 for the longshoremen’s union.

Persak is running for one of the two at-large positions on the November ballot which will continue to be elected on a city-wide basis. The other seven positions on the council will be elected on a district basis.Presently, all nine council posts are elected city-wide.

It is speculated that at-large systems encourage the election of candidates who appeal to ideological or other more universal issues while districts encourage candidates who focus on local geographic concerns. The local focus brings us back to all those 25,000 businesses and their interaction with local people including likely voters.

That kind of community interaction cannot be bought. Can it be put to constructive political use?  Remains to be seen.

In 2010, the US Small Business Administration published a report estimating federal regulations for economic, environmental and tax issues cost private businesses about $1.75 trillion, or $8,086 per worker.

The estimated tab grew to over $2 trillion in an update published in 2014 by the National Association of Manufacturers (NAM). Per worker costs grew by 23% to $9,991 per worker. Inflation growth for that period was under 9%.

The 2014 report claimed the per-worker cost for those with less than 50 employees was $11,724, compared to $9,083 for firms with 100 or more workers. Part of the discrepancy was due to economies of scale favoring larger organizations. But, differences were also attributed to business type and the difficulty of small employers in keeping up with creation of legislation and administrative rules.

Regulatory compliance was far higher for industrial employers.

According to the 2104 NAM report, manufacturing firms paid twice the rate per worker – nearly $20,000. Those with fewer than 50 employees paid far more – $34,000 per-worker. That compared with $13,750 for those with 100 or more.

The February 24th meeting will be held in the auditorium at Colin Hall at South Seattle College. Colin Hall is located in the southwest corner of the campus just off East Marginal Way. Use the campus entrance off Corson. RSVP to Tory@seattleindustry.org.

Questions? Call the MIC at 206-762-2470.