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For release on delivery
6:10 p.m. EDT
May 15, 2014

Small Businesses and the Recovery

Remarks by
Janet L. Yellen
Board of Governors of the Federal Reserve System
National Small Business Week Event
U.S. Chamber of Commerce
Washington, D.C.

May 15, 2014

Thank you, Administrator Contreras-Sweet, I am pleased to be at the U.S.
Chamber, to have this opportunity to be part of Small Business Week, and to meet the
outstanding entrepreneurs here this evening. I am also grateful to be able to share a few
thoughts on the important role I believe small businesses have played and will continue to
play in America’s recovery from the financial crisis and the Great Recession.
After the onset of the crisis, the Federal Reserve took extraordinary steps to
stabilize the financial system and halt the plunge in economic activity. Since then, the
Fed has continued to use its monetary policy tools to promote the recovery and make
progress toward our mandated objectives of maximum employment and price stability.
By putting downward pressure on interest rates, the Fed is trying to make financial
conditions more accommodative--supporting asset values and lower borrowing costs for
households and businesses and thus encouraging the spending that spurs job creation and
a stronger recovery.
Crucial to this process, as I just mentioned, is job creation. The Federal Reserve
tries to promote the conditions to foster job creation, but, overwhelmingly, it is
businesses that create the jobs. About 85 percent of nonfarm employment is in the
private sector, which traditionally is the source of a similarly large share of new jobs
during economic expansions. So far during this expansion, public-sector employment
has declined and the private sector has accounted for all of the net increase in
employment, so businesses have been even more crucial to job creation than usual.
Small businesses, of course, are responsible for a large share of these new jobs.
According to the latest data from the Labor Department, a little more than half of the net
number of jobs created since employment began growing in 2010 has been generated by

-2firms with fewer than 250 employees, and most of that amount was accounted for by
firms with fewer than 50 employees.1
One of the reasons I wanted so much to be here this evening was to be able to
acknowledge these important contributions. America has come a long way since the dark
days of the financial crisis, and small businesses deserve a considerable share of the
credit for the investment and hiring that have brought that progress. Although we have
come far, it is also true that we have further to go to achieve a healthy economy, and I am
certain that small businesses will continue to play a critical role in reaching that
I am honored to be addressing the owners of 53 small businesses whose
excellence exemplifies the enormous contributions that millions of small businesses
collectively make to our economy. You come from different places and have achieved
success in a wide variety of ways, but you all share the entrepreneurial spirit that has
always been central to our nation’s prosperity. We at the Federal Reserve are keenly
aware of your vital role, and we pledge to continue to do our part in promoting the
recovery so that you can continue to help America grow and prosper.
Thank you.


See Bureau of Labor Statistics (2014), “Business Employment Dynamics: Third Quarter 2013,” press
release, April 29,