Guest Editorial
The “Great Recession” is over, but are small businesses getting a fair shake as they do their part to help the economy recover?
That question is raised in a new study from Michigan State University that looks at loans to small businesses. Its finding: A lack of access to money is keeping them from doing more.
The study, by MSU’s Center for Community and Economic Development, looked specifically at lending in northern Michigan. From 2007 to 2010, loans in 21 counties dropped by 20 percent, according to Gongwer News Service.
What’s more, Gongwer reported, the study’s director said the findings could be applied throughout Michigan.
The banking industry’s meltdown in late 2008 and the clampdown on credit that followed were devastating. Even healthy businesses struggled as banks called in lines of credit, or declined to bankroll reasonable prospects for development.
If that is continuing, it’s a drag on the economic recovery. Businesses are more willing to hire, but they often needs access to capital through bank loans.
We appreciate that banks are being more thoughtful with their loans — they should — but there needs to be a middle ground between prudence and dampening business growth. Based on this study, it is clear that private lenders have not found that middle ground yet.
— THE JACKSON CITIZEN PATRIOT