YOUNGSTOWN, Ohio – The forecast for small business is favorable, thanks to the rise of artificial intelligence, new federal programs and an increased focus on U.S. manufacturing.
Everett M. Woodel Jr., Great Lakes regional administrator in the U.S. Small Business Administration, characterizes the outlook for small businesses positively. The region includes Ohio, Michigan, Indiana, Illinois, Wisconsin and Minnesota.
“I have the opportunity to travel the whole Great Lakes now,” says the Ohio native, who previously served as SBA’s Columbus district office director.
“When I went into this role, it really gave me an opportunity to see similarities amongst many of the businesses, especially across the Great Lakes,” he adds, pointing to the region’s manufacturing strength.
In March 2025, SBA announced the Made In America Manufacturing Initiative, which seeks to restore American economic dominance and national security by empowering small manufacturers, according to a news release from the agency at the time. The initiative kicked off in the Great Lakes region and Woodel says that’s fitting as five of the country’s top manufacturing states are in the Great Lakes.
“What we learned was that manufacturing has become so capital intensive that really the machinery they’re buying now is not the same machinery that you and I grew up with,” Woodel says. “It is truly expensive – half a million, $2 million machines” for a tool and die shop.
Access to capital is always a challenge for small businesses, he says. The SBA listened to manufacturers’ concerns and the administrator took them back to Washington, D.C., he adds.
“Our loan programs aren’t sufficient for these manufacturers,” Woodel explains. “So the [U.S.] House [of Representatives] has already passed legislation to increase our cap limit from five to $10 million dollars. We’re waiting for the Senate to do the same.”
SBA is launching new programs to meet business needs. In March, it started a program for grocers and food producers with a 90% guarantee. The Manufacturers’ Access to Revolving Credit loan program, begun in October, offers a 75% to 80% guarantee, he says.
“We’re starting to see an uptick in individuals that are looking to access that type of loan, and with such a high guarantee on it, lenders are more inclined to loan it out as well,” the Great Lakes regional administrator says.
“Access to capital is something that we do, and so we’re out there creating new programs to try to help our manufacturers and all small businesses be able to access the capital they need to not only start, but in some respects, grow and build capacity,” Woodel says.
Uncertainty
But political and economic factors affect small businesses too.
Omer Genc, an associate professor of management and marketing in the Williamson College of Business Administration at Youngstown State University, views the small business forecast as mixed.
Small business indices show companies are still earning profits and boast stable revenues. And technological advancements including artificial intelligence enable companies to be more efficient, Genc explains.
“There are some positive outlooks and some negative or pain points as well,” he says. “First of all, we are definitely not in a recession. The economy is still growing, although not very high, but it’s still growing, not contracting.”
“But of course, especially given the current political conditions and the war, there is a lot of uncertainty,” he says.
Inflation isn’t as bad as it was, but energy prices linked to the war in Iran are driving up costs and surveys of small businesses show declining optimism, the professor adds. April inflation hit about 2.3%, which isn’t as bad as experts predicted, Genc says. “But of course, this downturn trend has kind of stopped, given that increase in energy
prices.”
If energy prices don’t fall, overall inflation will tick up within a few months, he adds.
Sustained higher interest rates also affect small businesses, limiting access to capital.
“First of all, companies really hate uncertainty,” Genc says. “They want a stable environment and in this kind of uncertainty – uncertainty about interest rates, uncertainty about inflation – companies usually postpone big projects or big initiatives.”
Eric Gaber, a business administrator lecturer at Westminster College in New Wilmington, Pa., and director of the Westminster Entrepreneurship Center, agrees.
“I think the outlook is very strong,” he says. “I know the economics right now with Iran’s situation of the price of oil is making the economy as a whole somewhat tenuous, but if you strip away any of these temporary influences the overall outlook for small businesses right now, in my opinion, couldn’t be better.”
Transformational Tech
Like Genc, Gaber points to AI, calling it the great leveler.
“It is the great ability for small businesses to compete with larger businesses, because it saves so much cost and you automatically have an expert in your office for free,” he explains. “The other reason is the bigger companies are outsourcing at a higher rate, more now than they ever have, which lends opportunity to the small businesses.”
Gaber calls AI transformational technology that’s going to be a boon to the economy. But it’s not AI itself, he adds, likening it to an iceberg.
“At the very tip of the iceberg is the concept and the use of AI,” he says. “But to exercise and execute that technology, you need a humongous amount of support. That’s the iceberg under the water. What I mean by that is you need data centers to support AI, right?”
Many data centers are under construction or planned in western Pennsylvania. Those data centers need power plants to fuel them. They also need electricians, HVAC technicians, AI consultants and corporations with AI departments.
“All of this massive growth is when small businesses really thrive,” Gaber says. “Every time there’s a technological advancement, small businesses thrive.”
Starting a Business
When deciding if it’s the right time to start a business or to expand one, inflation, interest rates and political conditions are among considerations.
“However, these kinds of environments can also create opportunities because not a lot of people are eager to invest in this kind of environment, which means less competition,” YSU’s Genc offers.
It’s important to find the right business and business structure. If your cost structure relies on energy prices and labor prices, for example, it would be risky to start a business this year, the professor explains. But AI and related technology businesses are booming.
“And one thing I want to add to that is, especially in those booming industries, technology driven industries, you don’t want to miss” the opening, Genc says. “If you wait for everything in the environment to be perfect, it might be too late. It might be already crowded. So that’s why, yes, you need to be careful, but you should not miss the opportunities as a result of this answer to uncertainty.”
Gaber concurs. Large businesses are particularly averse to uncertainty.
“Because we’re in a little bit of a blip of uncertainty, big businesses are traditionally much slower to move,” he says. “…most innovation and patents come from small businesses because they are forced to change, adapt, influence and create. The fear of change affects big corporations the most.”
Small businesses are more nimble and if that attribute is applied well, it positions those businesses to succeed, Gaber says.
“Now with that said, big businesses are big for a reason,” he continues. “They’re smart. They’ll let the little guys do all the heavy lifting and take all the risk, and when it becomes successful, they just sweep on in and buy them out, whether it be a defensive acquisition or an asset-based acquisition.”
That isn’t bad though. Large businesses are able to scale and commercialize what smaller businesses have created, he adds.
Woodel, the SBA Great Lakes administrator, would point entrepreneurs considering launching a business, or existing business owners considering an expansion in the Mahoning Valley, to a local source.
“You actually have an amazing SBDC [Small Business Development Center] there at Youngstown State,” Woodel says. “They are phenomenal.”
He also points to the selection of Mark Lamoncha, CEO of Humtown Products of Columbiana and Boardman, as the SBA Ohio Small Business Person of the Year. Mr. PC Inc. of Warren was named the Ohio Rural Small Business of the Year.
An SBDC can identify what a business needs, loans that are available to it and direction to participating financial institutions, the administrator explains
“I always tell individuals, even when I was district director, to start local, start at your SBDC,” he says. “They actually have the pulse of that area.”
Good Days Ahead
Woodel points to the change in industry in Ohio over the last several decades. What used to be a mom and pop tool and tie shop, for example, is run by its founder’s grandson who is investing in 3D printers.
“Those things cost money. That’s why the SBA can be helpful,” he says. “Youngstown is very similar. It is growing in manufacturing. I think that our good days lay ahead of us. This onshoring is critical to bring back these manufacturers and the products that they produce.”
The Youngstown area is seeing a resurgence in manufacturing and small businesses in general, Woodel adds.
“I grew up in a small business, a bakery in Fremont, Ohio,” he says. “It’s not the same as a manufacturer, but really they are what keep this economy running. Two out of three jobs are created by the mom and pop shops, not corporate America. No disrespect. Big corporations, they play their part, sure. And a lot of these small businesses are providing them with products and services. But the wealth generator for local economies and the ecosystem in those economies is coming from our small businesses.”
