Way back in October 2021, my eBulletin advised you that the number of Labor Surplus Areas had sky-rocketed. The LSA list published annually by the U.S. Department of Labor and effective October 1, is an effective tool in determining 504 program eligibility. I remember exerting enormous restraint in waiting ‘til October 4 to check out the list. And was I in for a surprise.
“Wow!” I cried, “That’s the largest LSA list I’ve ever seen. What a boon for SBA loan marketing!!” Businesses in an LSA get two benefits: Size standards are increased by 50%, and assistance to a business located in an LSA qualifies as a Community Development goal. I mused that maybe the pandemic or other outside forces had dramatically altered the country’s labor market.
Because an LSA determination is only good for a year, I encouraged everybody to make marketing in an LSA a priority. “Make sure your referral sources are aware,” I advised our clients, “… for it is written, ‘Make hay while the sun doth shine.’” I then sent the list to dozens of savvy practitioners who wanted to increase their loan volume. Maybe you were one of them.
Now, Another Surprise. It turns out that the U. S. Department of Labor posted incorrect information: Outside forces had nothing to do with it. The government just blew it. That LSA list contained roughly 50% more areas than it should have. To qualify as an LSA, the area’s unemployment rate for the previous two calendar years has to be 20% higher than the national unemployment rate for the same period. Somehow the Department of Labor miscalculated the two-year unemployment rate average. My 8th grade math teacher, Sister Mary Philomene would have been so disappointed.
Not to worry. From a big lemon tree, comes lemonade. The Bureau of Labor Standards has published a corrected LSA list. Need that list? Let me know.
Off we go then, to another merry round of SBA loan marketing.