House Speaker Richard Corcoran says small businesses get 'almost nothing' from Enterprise Florida

Florida House Speaker Richard Corcoran continued his scorched-earth campaign against taxpayer-backed business incentives, this time attacking Gov. Rick Scott for spending too much time defending Enterprise Florida and not enough time on issues that protect jobs.

In an April 3 Tampa Bay Times column, Corcoran warned that not addressing the state's workers' compensation system and a property insurance issue known as "assignment of benefits" will put small and family-run businesses in jeopardy.

Corcoran said that instead of working with the House on these issues, Scott has spent most of the 60-day legislative session fighting for an agency that doesn’t help small businesses.

"(Enterprise Florida) subsidizes big companies with over 1,000 employees to compete against our small businesses, which make up 98.9 percent of all businesses in the state and employ nearly half of the state's private sector workforce and who almost never receive a penny of government money," Corcoran wrote.

For this fact-check, we decided to focus on the statistics about small businesses in Florida and whether they "almost never" receive government money.

Regardless of how you define them, small businesses make up a large chunk of all businesses in Florida. However, his point that small businesses "almost never" receive government money is at best an exaggeration.

Small businesses not so small in Florida

There is no standard definition for a small business. The difference between large and small firms can depend on how many people a firm employs, the amount of revenue the firm makes or the type of industry.

No matter which way you slice the pie, small businesses in Florida comprise a significant chunk of all business in the Sunshine State.

Florida is home to approximately 2.4 million businesses of all sizes. That figure includes large firms, small firms and nonemployer firms — a technical term to describe a business with no employees.

Most nonemployers are self-employed individuals whose business may or may not be the main source of income, such as someone who earns money as a tutor.

Nonemployers make up 81.5 percent of all businesses in the state.

The latest snapshot comes from the federal government. The Small Business Administration's Office of Advocacy considers a small business as any firm with fewer than 500 employees (including the nonemployers).

Under that metric, the total number of small businesses is about 2.3 million. That comes out to 99.8 percent of all businesses, an even larger share than Corcoran’s figure.

Corcoran got to his figure of 98.9 percent by excluding firms without a single employee. The figure came from a report that divided the number of firms with fewer than 500 employees (almost 420,000) with the total of firms with employees (424,550).

To throw out another measure that still proves the prevalence of small businesses, firms with fewer than 20 employees make up about 90 percent of all businesses in the state.

Corcoran’s point about small businesses employing "nearly half" of the workforce is slightly above the actual figure.

The latest number shows that small businesses (defined as fewer than 500 employees) employed 3.2 million people. That is about 42.8 percent of the workforce.

Kwame Donaldson, a senior economist at Moody’s, said that compared to the national average, small businesses in Florida employ a smaller share of the workforce (43 percent in Florida vs. 48 percent nationwide).

Are small businesses getting gypped?

Corcoran said small businesses "almost never" get government money.

Corcoran’s team pointed to a December 2016 review of Enterprise Florida’s economic development system by the Office of Program Policy Analysis and Government Accountability, a nonpartisan research arm of the Legislature.

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The analysis found that the majority of businesses incentives (51.9 percent) went to employers with more than 1,000 employees.

The analysis pointed out that businesses with less than 50 employees received only 14.5 percent of economic incentives.

"Although 96 percent of the state’s businesses employ fewer than 50 employees, most state-level economic development programs, particularly incentives, generally benefit large businesses," it reads.

Here’s the breakdown:

If we consider a small business as a firm between 1 and 499 employees, as Corcoran did for the other part of his point, then small businesses were awarded 38.3 percent of economic incentives.

That’s not as much as the big firms got, but it’s not "almost nothing."

Our ruling

Corcoran said small businesses "make up 98.9 percent of all businesses in the state and employ nearly half of the state's private sector workforce" and "almost never receive a penny of government money."

No matter the definition, small businesses in Florida make up the majority of all businesses in the state. Corcoran’s specific numbers are accurate if a small business is defined as any firm with fewer than 500 employees.

However, by that 500-employee metric, it is not the case that small businesses "almost never" receive government money. While large firms get the majority of incentives, firms that employ between 1 to 499 people in Florida were awarded almost 40 percent of all incentive projects in past years.

So while large firms receive the majority of economic incentives, it is imprecise to say there’s "almost nothing" left for the little guy. 

For a partially accurate claim that requires explanation, we rate it Half True.

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Half True

Says small businesses "make up 98.9 percent of all businesses in the state and employ nearly half of the state's private sector workforce" and "almost never receive a penny of government money."

Richard Corcoran

House Speaker

in an op-ed

Monday, April 3, 2017

04/03/2017

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