Why U.S. SMEs Struggle with Exporting and How to Fix It

International trade is a cornerstone of the U.S. economy, contributing significantly to its gross domestic product (GDP). In 2022, U.S. GDP was $25.46 trillion, representing a quarter of the global GDP. With total international trade in goods and services reaching $6.97 trillion, the U.S. set export records with 73 trading partners. However, as the complexity of exporting rules and systems increases, small and medium-sized enterprises (SMEs) face significant challenges in navigating this landscape, explored in a whitepaper from the Minnesota District Export Council (DEC): Bridging the U.S. National Export Skills Gap.

Areas of Exporting with a Skills Gap

The DEC whitepaper explains that a lack of seasoned professionals who understand exporting is a key barrier to exporting for SMEs. These are some of the areas where the U.S. is falling short, according to the whitepaper:

1. Educational System Gap

Traditional educational systems in the U.S. often overlook export-focused programs. Many colleges and universities offer only token courses on international trade, leaving a gap in the foundational knowledge required for effective exporting.

2. Business Gap

U.S. businesses struggle to integrate trade expertise into their operations. Larger companies often silo trade functions, while smaller businesses lack the resources to recruit and retain export professionals, leading to missed opportunities and increased risks.

3. Government Gap

Institutions like the International Trade Administration’s U.S. Export Assistance Centers lack the resources to meet the vast needs of businesses, particularly SMEs. 

4. Regulations Gap

Complex and dynamic export regulations disproportionately affect smaller exporters. The punitive approach to minor reporting errors and the lack of simplified guidance increase the risk of non-compliance, deterring SMEs from pursuing export opportunities.

5. Export Assistance Market Gap

The network of attorneys, consultants, bankers, freight forwarders and software vendors supporting exporters also faces a shortage of qualified staff. Private training firms and industry organizations struggle to fill this educational void with consistent quality and success.

Recommendations

The DEC whitepaper explains these challenges in more detail, looks at how other countries are succeeding and offers several proposals to make exporting more successful in the U.S. You can read the full whitepaper here: Bridging the U.S. National Export Skills Gap.

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