According to Karen Gordon Mills, small business is bringing huge revolution in the economy of U.S. it occupies more than half of the man force in private sectors that approximated equals the population of 62 million. But it’s them behind the creation of a new situation of employment.
Small business faced a great loss during the time of Great Recession resulting in loss of jobs as the crisis hit badly in banking sectors. Some parts of the economy though faced improvements but small businesses had a hard time mainly due to the reluctance of banks in proving loans of smaller dollars to small firms.
A new and innovative sector of financial technology is quite active in reducing the obstacles. Necessary procedures are taken by the respective banks in forming a legal partnership with the newcomers. The lenders of financial technology are much concerned about keeping transparency as well as the high charges levied on the borrowers.
All these are regulated by a governing body under proper regulations protecting lenders as well as borrowers of small businesses to have easy access to credit without hampering growth.
Scope of entrepreneurs
Many have noticed that a huge number of businessman seek loans of less than $250,000 and another group of businesses seek loans less than $100,000.
Some rising entrepreneurs and inventors took it as a boon and no wonder a new group of lenders targeted this part of the market as the opportunity are high enough to make a good turnover.
These driving innovators have formed a rising online platform by using scoring algorithms of new data and credit for customers to access easily. Over the successive years, this new technology of online lending has seen a huge growth in terms of expansion of new companies, the emergence of new products and by also creating awareness among borrowers of small business.
This phase is considered as the peak time where these new lenders have captured a large part and dominating the lending market of small businesses. Some expected that days are gone when traditional banks was a major concern in lending small-dollar loans.
Impact of Supply chain industries in the global economy
In the economy of the U.S, suppliers of services and goods play a great role in the overall performance of the nation. Manufacturers are the sole main in propelling towards innovation in the economy of U.S.
Considering the input-output accounts of 2002 as a benchmark, emergence of new supply-chain industries has segregated it from business-to-consumer industries.
Business-to-consumer industries are those that trade their services and goods to the consumer while supply chain industries trade mainly with government or other businesses are unique and they cover a great portion of the economy with inputs from service providers and manufacturers.
In supply chain industries, mainly traded services that often traded across different regions generates a large number of STEM Jobs like physical infrastructure (engineering, construction, and architecture), transport services, and creates the majority of franchising, direct marketing, retail, wholesale, direct selling.
Industries of supply chain face higher job opportunities and more average wage than industries of business-to-consumer. It’s been noticed under the period of (1998-2013) that employment in the sector of supply chain industries has evolved to a great extent as well as wages form various service providers to manufacturers.
While industries under business-to-consumers though witnessed number of employment but wages are comparatively low due to less no of STEM jobs and wages in local services. Researchers suggest that more groupings under supply chain industries are necessarily important for economy and innovation.
How entrepreneurship is crucial in the U.S economy?
Start-ups are spread extensively and an important factor in the U.S economy. In the past few years, start-ups have experienced a slowdown whose unfavourable consequences impacted the prospects of middle-class people of America.
As per the reports of Milstein Commission, an innovative five ideas can give a new start to entrepreneurial skills of America and can pave a new path in creating sustainable jobs for the middle-class people.
These include more access to credit for the rising entrepreneurs, making easy and transparent regulations so that new owners can understand, educating young generation about the prospects of entrepreneurship can give rise to many new and promising business creators, forming a strong circle of entrepreneurs under efficient leaders and lastly stimulating investment in program-related investments.
Milstein Commission’s findings propose that entrepreneurs should be the heart of the nation in building American Economy; together they can attain the American dream.
Role of technology
For a small business, the bank plays the important role in sourcing capital. However, getting a loan by small businesses is not that easy and the situation has seen no improvement in past years.
Even today small businesses depend largely on local banks for business purposes, which cost them spending 24 to 34 hours by visiting one bank to others, filling up necessary forms and carrying out paper works.
The whole process takes place manually and paper-centric which is time-consuming taking several weeks’ even months till it gets approved for borrowers or denied. These small businesses reveal their frustration for these old processes of getting loan sanctioned and even waiting for the decisions.
With the emergence of secondary lenders where Technology has played a vital role in lending loans improved a lot. Players like Funding Circle, Kabbage evolved in the late 2000s, which filled up the gap in the market and the whole process of lending payday loans became faster with the help of new sources of data like bank information of current account which includes contra transactions, withdrawals and deposits and by using financial data of real-time.
Regional industries are a group of supporting organisations and interconnected firms situating in particular geographical locations which represent a prospectus origin of productivity capable of leading in the competition of global economy in the wake of vulnerable situation of a nation. For these entire reasons, federal republic should undertake the necessary program to trigger collaboration of firms and organisations for more innovation and scope of employment.
Why do people prefer to study Corporate Finance?
At first, we need to get a clear idea of what is Corporate Finance. Corporate Finance deals with the financial structure of a public or a private company. You will find the subject both testing and exciting. It is fast becoming a very popular specialized degree program and you find a lot of scope in this field.
Most of the big companies have a separate department dedicated to corporate finance that looks into the budgeting and manages the capital structure of the company. The department also looks into the investments that the company does or will do in the future and ensures that the investments return a good amount of profit for the company.
Companies deal with a large amount of money at the end of the year when the profits and revenues are collected. To manage this huge amount of money tactfully and invest it wisely to meet the budget needs the company hires experienced and expert corporate finance employees. These employees are paid heftily to exhibit their expertise. The job is certainly very nerve-wracking but surely rewarding. If you love numbers and like accounting then this job is surely for you.
The corporate finance employees add life to a company and it is surely they who ensure the profit of the firm.
You need not tospecialize in any specific degree to work in corporate finance. Proper knowledge and a course of study in finance, accounting or business administration will get you there. A specialization in corporate finance is definitely an added advantage.
The study program of Corporate Finance
There are a variety of fields you can take classes of for mastering Corporate Finance. For a proper knowledge of the subject, you can take classes in accounting, finance and business administration.
Accounting will help you do the auditing and maintain the financial numbers on a daily basis. If you take classes in Financial Accounting then this area will get clear to you. Try to make your base strong in finance. Get the basic principles of investment clear and straight in your head in order to deliver well. Classes related to stocks, bonds, financial management can come to good help for you in this case.
The study can offer you the degree of Bachelors of Business Administration (BBA). BBA classes are very common and a good number of reputed colleges worldwide offer you this degree. To major in the subject, you can surely go for Master of Business Administration (MBA).
You can take the following courses that are related to Corporate Finance:
- Performance Assessment-
Study that will help you to assess or evaluate the profits and the losses that the company is running through.
- Investment plans-
You can get a good overview of the different investment plans that are going to be profitable for your company and how you can make such investments that ensure a profit.
- Finance Management-
Apart from needing to have a strong base in finance and a good understanding of financial issues you also need to master the managerial skills related to finance. This study will take you through the various useful skills that will help you ensure your company’s finance is properly managed.
- Basics of Accounting-
The classes related to accountancy give a good knowledge of taxation laws, auditingand managerial accounting.
- Business capital strategies-
These classes will help you to get a better idea of how the business runs and in turn will help you to expand the business in the long run.
- Investment advisor-
An Investment advisor is the one who gives advice about different investment plans to the clients. For example giving advice on mutual funds, bonds, stocks.
- Financial reporter-
This itself has a vast job opportunity. A Financial reporter is the one who gathers information from various researches and interviews to sum them up with their own creativity to create articles and write-ups about the current financial market. They mostly work for newspapers, corporate magazines, business news channels and various websites dealing with finance and economy.
- Financial analyst-
A financial analyst’s work is to research the various economic conditions, the financial condition of the company, the current market demands and give the right business guidance to the company.
A stock broker is the one working in a brokerage firm who buys and sells stocks on behalf of a company or an individual. A stockbroker advises the clients which share to keep and which to sell and make the maximum profit.
- Fraud investigators-
With passing time frauds related to credit cards and insurance have increased. The job of a fraud investigator is to carry out investigations related to such frauds. You can imagine how demanding a job this can be.
- Investment banker-
A minimum of bachelor’s degree can get you through this job. This job pays really well to the employees.
Top 5 Finance schools in the United States
- The University of Pennsylvania-
Located in Philadelphia, Wharton School of the University of Pennsylvania is the leading and oldest school of business.
- Massachusetts Institute of Technology-
The MIT Sloan School of Management is located in Cambridge, Massachusetts and it offers all kinds of degree programs related to finance.
- New York University-
The Leonard N. Stern School of Business of the NYU has given birth to some of the richest and top-notch businessmen of the world.
- University of Michigan-
The Stephen M. Ross School of Business of the University of Michigan is located in Ann Arbor, Michigan.
- The University of Texas-
The McCombs School of Business of the University of Texas has its campus in Austin.
There are limitless opportunities in the field of Corporate Finance and with proper guidance and hard work you can surely build a rewarding and high-paying career as a Corporate Finance Officer.
Evelyn W. Minnick is a very talented online tutor who offers help related to various subjects dealing with business and finance. She has got an MBA degree with six years of job experience in Carroll School of Management, United States. She is an expert in Corporate Finance and Marketing and you can easily contact her if you need any assistance.