The economy is choking small-business development centers in Pennsylvania as demand remains fairly constant but services decline, according to a newly released annual report.
The report said funding for the 18 centers has been reduced by more than 30 percent over the past six years, with the 108,000 hours of consulting in 2012 the lowest since 1998. The number of entrepreneurs and small-business owners who received no-fee, expert, confidential business management advice held steady at 12,254.
“With fewer professional consultants, we are spending less time per client since the demand has not lessened,” Pennsylvania SBDC state director Christian Conroy said in a news release.
Fewer hours spent assisting businesses also resulted in a drop in start-up and expansion capital acquired. In 2012, the SBDCs helped companies raise $106.8 million in debt and equity financing — less than half the amount raised in 2008 during the height of the financial crisis.
The number of educational programs, 744, and program attendees, 13,983, held steady from 2011, although they are down approximately 30 percent from a decade ago.
The report said the network is bracing for an influx of small businesses struggling to deal with the effects of sequestration, especially small businesses that contract with the defense sector.
Other highlights from the 2012 services summary are as follows.
• Client government contracts — $150.4 million
• Assets preserved — $72.3 million
• Most requested consulting topics — start-up assistance, business plan development and marketing, sales and customer relations.
• Business sizes — 59 percent of clients had between one and five employees; 16 percent had six to 10 employees.
• Client industries — 56 percent service industry, 15 percent retailers, 14 percent manufacturers, 7 percent other and 4 percent each construction and wholesalers.
The top 10 business sectors served were as follows.
1. Professional, scientific and technical services
2. Accommodation and food services
3. Other services (except public administration)
4. Manufacturing, metal products
5. Health care and social assistance
6. Retail trade
8. Retail: tobacco, fuel, mail order
9. Manufacturing: food
10. Administrative, support, waste management and remediation services