A Christmas Gift for Nebraska

According to a recent article in the Lincoln Journal Star, Nebraska will have the largest cash reserve in history at the end of the fiscal year. By late June, 2008, it will reach $542.1 million.
To return financial rewards to rural Nebraska and the entire state, some money in the reserve should be invested in microenterprises. 

Microenterprises are businesses with five or fewer employees. Over the last 15 years a vast majority of all the jobs created in rural America – as much as 70% – were created by firms with five or fewer employees.

In a recent Center for Rural Affair’s report (http://www.cfra.org/files/Microenterprise_in_2007_Farm_Bill.pdf), the Association of Enterprise Opportunity (AEO) estimated that microenterprise businesses have an average employment rate of 1.7 employees per business. The Aspen Institute found that numerous studies of low income microenterprises “generally found that each business generates about 1.5 jobs.”

Participation in a microenterprise program increased household income by an average of $3,058 per year. Household assets of microentrepreneurs also increased over time, with most of the asset growth occurring in homeownership.

The Federal Reserve Bank of Kansas City states that, “Rural policymakers, who once followed traditional strategies of recruiting manufacturers that export low-value products, have realized that entrepreneurs can generate new economic value for their communities. Entrepreneurs add jobs, raise incomes, create wealth, improve the quality of life of citizens and help rural communities operate in the global economy.”

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