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Public subsidies for new enterprises development - example of Bielsko-Biała Labour Office

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Problems of entrepreneurship, entrepreneurs and small business have been widely discussed in Poland especially with regards to the problem of high unemployment rate. Unemployment has been inherently related to the labour market. For the last several years considerable fluctuations of this rate has been observed in the global economy. The unemployed workforce could be utilized for the production of goods and services. Since they are not doing so, the economy is losing out on its output. Income tax is an important part of the revenue for the government, but the unemployed are unable to earn and the government loses out on the income tax revenue. The government has to also pay unemployment insurance benefits to the claimants. Because the government loses on both sides in terms of unemployment benefits and loss of tax revenue, one of the most important government functions is unemployment prevention and reduction. Difficulties with finding appropriate job can be also the triggering factor for something new in life of such people. They more often try to start their own businesses especially if they can be supported with public money.
Small and medium enterprises (SMEs) sector has been considered the most important source of entrepreneurship and innovations in almost every modern economy. The mentioned sector of enterprises accounts for over 95% of firms and over 60% of employment and creates a significant share of new jobs in
EU economy. The very specific strengths and weaknesses of SMEs require special policy responses.
Global environment makes many of the traditional problems facing SMEs, such as lack of financing, difficulties in exploiting technology, constrained managerial capabilities, low productivity, regulatory burdens, more severe. On one hand small firms need to upgrade their management skills, their capacity to gather information and their technology base. On the other hand governments need to improve SMEs access to financing, information infrastructures and international markets. Such strategy can help SMEs meet the challenges of unemployment and slow economic growth.
Role of entrepreneurship in economic development
The phenomenon of entrepreneurship is very difficult to define. Such terms as small business owner and entrepreneur are sometimes used interchangeably. Although some situations encompass both terms, there are important differences in their meanings. Small businesses are businesses that are independently owned and operated, are not dominant in their field, and usually do not engage in many new or innovative practices. (...)

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