How Does Small Business Administration Work?
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- Small businesses employ nearly half of American workers.
- Small business managers face somewhat different responsibilities than administrators.
- Small Business Administration loans help many small businesses thrive.
What Is Small Business Administration?
The business field features many professional paths, including small business administration. Successful administrators ensure their employer's short and long-term growth. They need specialized expertise, as small businesses face different challenges than general businesses with more employees and a larger revenue stream.
Small business administration differs from small business management. Business administrators make important leadership decisions affecting the entire company. Business managers organize resources and supervise staff. Continue reading to find out more about how to start a career in small business administration.
Small Business Manager Responsibilities
- Interview, hire, and train new staff.
- Follow administrators' company policies.
- Develop reports for owners and other stakeholders.
- Analyze marketing campaigns' rollouts and effectiveness.
- Prepare budget reports.
- Research automation technologies.
- Keep up to date with the competition and collaborate with other businesses.
- Stay up to date with the latest trends and innovations.
Starting a Career in Small Business Administration
Education
Small business administrators come from different educational backgrounds. Those without a college degree should explore programs at the associate level. Professionals with an associate degree can further their education by enrolling in a bachelor's in business administration degree-completion program.
Other educational opportunities include a master's degree, like an MBA, and online business certificate programs. A certificate in business communication prepares students to work as a human resources or public relations specialist.
Professionals with a bachelor's in a subject other than business may build their skills by taking continuing education classes. Options include introduction to entrepreneurship, human resources management, and social entrepreneurship. A local junior college may offer these classes online or in the evenings.
Job Demand and Salary
The Bureau of Labor Statistics (BLS) reports that professionals in management occupations earned a median salary of $102,450 in May 2021. Top earners made $160,960 or more. These figures account for different industries and professions.
The projected growth for small business managers varies by career. The BLS projects 9% growth in careers for human resources managers from 2020-2030. The latest BLS projection for training and development managers exceeds 10% growth from 2020-2030.
Careers in Small Business Administration
Accountant
Accountants analyze financial statements, help clients file taxes, and examine accounts for mistakes or fraud. Other responsibilities include maintaining financial records and cutting costs.
Accountants need at least a bachelor's degree. One or more professional certifications let them work with more clients and may increase their salary potential.
$77,250
7% projected job growth from 2020-2030
Financial Analyst
Financial analysts with a finance bachelor's degree research financial data, stay up to date with the latest economic trends, and help clients select investments. Other day-to-day tasks include reviewing their employer's financial statements and writing reports.
Financial analysts may specialize in an industry, region, or product. Job titles include fund manager and ratings analyst.
$81,410
6% projected job growth from 2020-2030
Human Resources Specialist
Human resources specialists help small businesses find and recruit the best talent. They interview applicants, check references, and onboard new employees. Other responsibilities include creating orientation and training programs.
Professionals work as a human resources generalist or recruitment specialist. Those without an academic background in human resources may hold a communication degree or business degree.
$62,290
10% projected job growth from 2020-2030
Want to learn more about small business administration? Check out our guide on how to become a small business manager.
Popular Online Business Administration Programs
Learn about start dates, transferring credits, availability of financial aid, and more by contacting the universities below.
Why Is Small Business Administration Important?
According to a Small Business Administration report from 2019, small businesses generate 44% of U.S. economic activity. Despite their economic impact, professionals working in small business administration face challenges their peers at a large business do not. Small companies more often experience financial instability and may be more vulnerable to economic fluctuations. Other typical challenges include recruiting the best talent, maintaining growth, and juggling different tasks.
These situations require professionals working in small business administration to develop their financial intelligence, management, and leadership skills. Managers must also use their communication skills to collaborate with business owners and other stakeholders. Open dialogue and trust increase the chances of financial stability and long-term growth.
The Future of Small Business
According to a report by the Proceedings of the National Academy of Sciences, nearly 45% of small businesses closed temporarily during the COVID-19 pandemic. However, the Small Business Administration (SBA) reports that a significant number of small companies rebounded successfully by early 2021. This hopeful sign benefits the roughly 47% of American workers employed by a small business as of 2020, according to the SBA.
Professionals can prepare for a small business owner career by brainstorming ideas, developing a business plan, and creating a business structure. Other steps include mastering advertising and marketing basics.
Frequently Asked Questions About Small Business Administration
What is the Small Business Administration?
The SBA provides business owners with small business administration loans and counseling. Business owners also turn to the SBA to explore federal contracting opportunities.
The SBA website features essential guides for aspiring business owners such as "10 Steps to Start a Business." Each step offers a link to in-depth information and outside resources.
The SBA played an essential role during the COVID-19 pandemic by offering small business owners Paycheck Protection Program (PPP) loans. The SBA helped businesses navigate the PPP application process and now provides information on loan forgiveness.
How does the Small Business Administration define a small business?
The SBA uses size and income cutoffs to define a small business. However, these limits differ between industries. Most agricultural small businesses may not make more than $4,000,000 per year in total receipts.
The SBA considers affiliate businesses part of the primary business for designation purposes. As of 2010, small businesses must undergo a review every five years to maintain their status. This process involves submitting financial information.
What are critical skills for small business managers?
Succeeding in small business management requires leadership skills. Effective leaders inspire their employees and delegate responsibility to those most responsible. Delegation lets managers focus on more pressing tasks.
Small business managers need advanced financial literacy. This skill lets them make sound financial decisions, such as how much to invest and save. Successful managers with these skills help their business avoid debt.
Individuals creating a new small business use their project management skills to develop long-term goals and hire a core team. A sound plan and competent employees help managers offer consumers an attractive service or product.
Can I become a small business manager without a degree?
Starting or running a small business does not require a college degree. Individuals may learn essential skills by earning a small business startup certificate. These year-long programs feature core coursework in business law for entrepreneurs, the entrepreneurial mindset, and business modeling.
A bachelor's degree lets some aspiring small business managers develop their skills further. These four-year programs emphasize coursework in administration, business plan writing, e-commerce, and budgeting. Degree-seekers also develop transferable skills small business owners need for success.
Prospective small business managers explore academic opportunities by researching online. College admissions counselors also help applicants learn more about business programs and potential career paths.
How much money can I make as a small business manager?
Payscale reports that business managers make an average annual salary of $64,040 as of July 2022, a figure that includes bonuses and commissions. Some experienced professionals earn more than $114,000. The bottom 10% of earners make $41,000 or less.
Small business managers may increase their salary potential by mastering in-demand skills. Payscale shows that consulting management, business intelligence, and product development skills help many managers earn more. Other in-demand skills include strategic product management.
Career paths for small business managers that may lead to a higher salary include office manager, business office manager, and human resources manager.
