Tech’s Impact on Small Business: Lessons for Policymakers and Tech Companies
Tuesday, January 23, 2018
Tom Donohue, president and CEO of the U.S. Chamber of Commerce, said on Jan. 10 in his annual State of American Business speech that “Technology is not a single, all-powerful industry. It is now a part of every industry.” He went on to explain that technology “will continue to change the way we work, communicate, and live—at a rapidly accelerating pace.” So it’s no wonder that small businesses across America are online and using digital channels to connect with customers, recruits, and seek new opportunities—either in the U.S. or around the world.
But what is the real impact of digital tools, and specifically social networking sites, on small business owners?
In order to answer that question, we teamed up with research firm Morning Consult and Facebook to explore how small businesses are using social media and digital platforms to grow, sell, and hire. (Read the new report: Examining the Impact of Technology on Small Business)
Everyone is doing it:
- 84% of small businesses in the U.S. use at least one major digital platform to provide information to customers;
- 3 out of 4 U.S. small businesses use tech platforms for sales;
- 80% are using at least one digital platform to show products and services, as well as to advertise.
Small businesses owners still face hurdles with online adoption:
- 57% of small businesses surveyed said that lack of familiarity with available digital tools is a challenge;
- More than half of American businesses still view the cost of internet services as a constraint to building an online presence;
- Among small businesses that don’t export, 40% said that they believe exporting to foreign markets would be too expensive.
To eliminate the hurdles for small business owners, and increase the opportunity for economic growth, there are a few lessons for policymakers and tech companies:
- Invest in digital skills training for small businesses: Programs teaching America’s small business owners how to leverage digital platforms will help them access new customers and grow demand.
- Invest in programs that increase 21st century digital literacy for the workforce, including job seekers: Digital literacy should be in K-12 education, higher education, and workforce development programs because of the growing demand for those skills in the workplace. (Think boot camps, government- or company-funded trainings, and more.)
- Invest in trade and export education for small businesses: The report found that the majority of small businesses surveyed don’t think it’s important to sell to other countries; and many think exporting is too expensive. With 95% of the world’s customers living outside the U.S. there is huge opportunity in international trade for small businesses. Trade-specific education could be dovetailed with digital skills trainings—explaining the benefits of accessing a global marketplace and offering ways to navigate it.
- Invest in ways to make it easier for small businesses, regardless of geographic location, to use technology to run their businesses: Policymakers and tech companies should support efforts to improve access to high-speed internet access in rural, tribal, and other underserved areas.
- ?Invest in digital tools that benefit minority-, veteran-, and women-owned small businesses: Let’s figure out how technology is helping these small businesses succeed, and increase investment in the tools and programs that are proven to work.
Like Donohue said in his address, “Technology will continue to be a major driver of stronger, sustained growth—and if we leverage it smartly and carefully, we will all benefit.” It’s clear that technology is playing an important role in helping U.S. small businesses start, scale, and succeed.
By Tim Day
As senior vice president of C_TEC (Chamber Technology Engagement Center) at the U.S. Chamber of Commerce, Tim Day highlights the role of technology in our economy and advocates for emerging technology.
Category: Partner News, Advocacy News, Economic Development