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There’s nothing small about small businesses’ contributions to the American economy. In recent decades, small companies have accounted for approximately two-thirds of new jobs, employed about half of the nation’s private-sector workforce, and delivered half of our nation’s economic output. They were instrumental in helping our country pull out of the recession and bounce back in recent years.
In addition, we know that their contributions to their local neighborhoods and communities, to the wellbeing of their employees, and to America’s innovation engine run even deeper.
Unfortunately, we also know there are barriers holding them back from doing even more.
This year, we’ve been hitting the road and meeting with business leaders across the country from companies of all shapes and sizes -- including many small business owners -- as part of our #LetsGrow Tour. In addition, the U.S. Chamber’s Small Business Council, comprised of yet more entrepreneurs and small business owners, met earlier this month in Florida and discussed several of the hurdles they face when trying to grow their companies and hire more workers. In these and other recent forums, some consistent themes have emerged regarding the biggest barriers to growth on Main Street.
No issue comes up more often than overregulation. A surge in federal regulations over the past decade has left small business owners overwhelmed, and many report that it’s stunted their growth and slowed their hiring. Research conducted by the U.S. Chamber of Commerce Foundation recently probed into the costs of red tape on small business, illustrating the enormous drag that federal mandates have placed on America’s smallest companies. Moreover, the study presents evidence that this torrent of new rules has contributed to a slowdown in the number of new business starts across the country.
However, there are reasons for optimism on this front. The White House and Congress have recently made real progress on their promises to rein in the regulatory states. Should they continue to take steps to eliminate some of the most burdensome rules and reform the underlying regulatory process, we can expect to see small companies start to grow at a greater clip in the years ahead.
Meanwhile, another longstanding barrier to growth is access to capital. Challenges pertaining to obtaining capital have been a consistent theme for small businesses for many decades, and we must overcome that hurdle if we hope to unleash innovation and business growth. Unfortunately, regulations stemming from the 2010 Dodd-Frank law have had the opposite effect, further limiting small businesses’ access to capital. Washington must do more to help companies of all sizes, but particularly small businesses, obtain the financing they need to grow and create jobs.
Like capital, talent can prove elusive for small businesses. Lack of qualified candidates and a skilled workforce is challenging for businesses of all sizes, which don’t always have a human resources staff or department to help them find that next great employee. In a recent study by the Goldman Sachs 10,000 Small Business initiative and Babson College, researchers found that more than 70 percent of small businesses find it difficult to find and hire qualified employees. With this in mind, Washington policymakers should do more to improve our education and worker training programs.
There’s much more we can do -- and must do -- in Washington to support America’s small businesses. From fixing our broken health care system and reforming the tax code to investing in infrastructure and unlocking more export opportunities, we have a once-in-a-generation opportunity to unleash the next era of growth and prosperity for businesses across the country, including small businesses. Coupled with the looming promise of changes that remove burdensome regulations and help employers access the capital and talent they need to succeed, we could be on the cusp of a boom on Main Street.
We’re looking forward to working with entrepreneurs and policymakers to deliver on this promise.
Don’t miss U.S. Chamber of Commerce Small Businesses Council Chair Maxine Turner testifying on Wednesday before the House Small Business Committee about these and other challenges facing small businesses. Tune into the hearing on Wednesday at 11:00 AM here.
On Thursday, I’ll sit down with Maxine for a Facebook Live chat, where we’ll dive even deeper into the State of American Small Business and what to expect in the year ahead. Tune into the Facebook Live chat Thursday at 12:00 PM