Meeting in the Middle: Summit Seeks Solution to Slack US Growth
Corporate America is navigating an economy marked by stubbornly high unemployment, and lackluster GDP growth. With large companies reluctant to hire, and small businesses struggling to survive, it may fall to companies in the middle to pick up the slack.
Meet Tom McGee. He's the guru on middle markets, and believes this sector has the potential to lead the economy.
"It's important for people to understand how big [the Middle Market] is, and how pervasively it impacts the US economy," says McGee, national managing partner of consulting firm Deloitte.
It's McGee's business to know what's going on in this space, because over half of Deloitte's US clients are middle-market companies.
Generally defined as businesses with revenue between $50 million and $1 billion, the middle market covers a huge swath of corporate America — accounting for 40 percent of GDP, and 40 percent of the country's workforce.
New research on the space, recently released by Deloitte, is garnering a lot of attention among American business leaders. Pinpointing what middle-market companies need to grow will be the major focus at "2011 National Middle Market Summit," held at Ohio State University on October 6.
Attending the conference will be leaders such as General Stanley McCrystal, Jeff Immelt, CEO of General Electric , and Fred Smith, and CEO of Fedex. Issues to be discussed include how the middle market can improve American competitiveness, GDP growth, and job creation in an otherwise lackluster economy.
A US-centric space, middle market companies generate $6.1 trillion in revenue, and employ more Americans than the entire S&P 500 , 24.6 million vs. 21.9 million according to Deloitte's research.
Yet expecting the 'Mighty Middle' to reverse the economic downturn may be overly optimistic.
"Companies in this space are positioning themselves to achieve growth, but the expectation is for modest — not robust — growth in this sector," says McGee, who goes on to explain that the biggest factor keeping mid-markets from "robust" growth is weak consumer confidence, mirroring the sour state of the US economy.
The hope is that by simply drawing more attention to this little-understood, yet critical sector of the economy, growth solutions will follow. McGee's message is simple: "When you look across the US, and think about how large the economy is, it becomes increasingly clear that the future of it is dependent on what happens in the middle market."