Recent years have seen increasing awareness and recognition of the role played by small businesses and their contribution to the economy in industrialized countries, and especially in periods of financial crisis and economic slowdown.
The major advantages of small businesses lie in their potential for innovation, flexibility, low start-up costs, rapid development, and the distribution of risk. Small businesses provide a solution not only to a general unemployment situation but also to the employment problems of special population groups such as new immigrants, women and demobilized soldiers.
Many successful businesses such as restaurants, shops, import/export firms, and public relations firms have been established by new immigrants. Other “olim” find ways to work on their own by working as translators, carpenters, plumbers, caterers, selling crafts and providing office services. Of course, certain professionals, such as writers, architects, therapists, dentists, artists, plumbers, electricians, etc, tend to work independently as a matter of course.
Small businesses encouragement
Small businesses, however, suffer from obstacles encountered in financing, management, marketing, export facilities, access to information sources and bureaucracy. The lack of guaranteed work-flow and income is probably the biggest single disadvantage to being self-employed.
All of these make it difficult for small businesses to establish themselves and compete in the free market.
The wave of mass immigration from the former Soviet Union, which Israel witnessed in the early 1990s, motivated the authorities in charge of immigrant absorption to focus on small business encouragement. The underlying idea was to find rapid employment opportunities for the immigrants while absorbing them in the economy in their professions and trades. Preliminary studies showed that this could help solve the employment problems of some 10-15% of the immigrant labor force.
The above policy shift led to the establishment in 1993 of Israel’s Small and Medium Business Authority (ISMEA), to formulate policies for encouraging small businesses, entrepreneurship and related activities and coordinate the operation of the various agencies working in this realm.
Assisting new immigrants
The assistance offered to new immigrants, in addition to the provision of advice and training through Small Business Development Centers (MATI in Hebrew), includes courses and workshops especially designed for new immigrants, in coordination and close partnership with the Ministry of Immigrant Absorption
Israel Small and Medium Enterprises Authority
14 Gruzenberg St.
Tel Aviv 65811
More info on the ISMEA website