Small Business Upstarts are Growing Fast |

Now is the time for Small Business Startups

March 2, 2023 DeeMan

One of the great magnets of America is the potential to rise from poverty and make a good living. It’s probably the most sought out vision of the American Dream. People from all over the world come here with the hopes of obtaining this vision. But this goal is not limited to foreigners. It is a dream that is rooted in American Culture. It is Hope.

Fueled by much of the stimulus money, many new small business are on the rise. To-date, the Biden-Harris Administration has distributed more than $400 billion in critical relief to more than 6 million small businesses. This in turn has impacted the business demand for labor and inventories near record highs. According to a leading survey of small business owners, the share of small businesses planning to create new jobs in the next three months is higher than it ever was at any point during the previous Administration.

Another recent survey of small business owners found that 71 percent are optimistic about their own performance in 2022, up from 63 percent one year ago. The broader economic recovery – one of the fastest on record – has also helped spur a surge in entrepreneurship. Americans are applying to start new businesses at a record rate, up about 30 percent compared to before the pandemic.

The widespread boom in entrepreneurship is a huge benefit for communities and a great sign for the U.S. economy. As new businesses grow, they are likely to employ more people in the community and fuel the local economy. About one-third of current new business applications are marked “high-propensity,” meaning they are likely to hire.

Entrepreneurship can also be a path of opportunity for minorities, women, veterans, young entrepreneurs, and immigrants to realize their dreams. According to a study, there was a 33% increase in Black male business owners in 2020 and 2021, and a 22% increase in Black female business owners.

The path to maintaining this growth would depend upon who you ask. The US Chamber of Congress has offered the following:

Encouraging individuals to start businesses rather than penalize entrepreneurs. For example, laws like California’s AB 5 and similar proposals at the federal level that force sole proprietors into an employee relationship. Reclassifying 1099 businesses as employees penalizes independent contractors who want to blend several business activities and benefit from self-earned income and increased flexibility.
Preventing punitive tax increases on small businesses by extending the 20% pass-through deduction utilized by small businesses. Without congressional action in three years, small businesses will face a massive tax hike.
Avoiding new mandates (like project labor agreements, Davis-Bacon wage requirements, mandatory retirement plans, etc.) that raise the cost of entry so high that small businesses can never break into the federal contracting arena.
Reversing pending moves by the Federal Trade Commission that make it harder for small businesses owners to eventually partner or sell to a larger business.
Protecting the freedom of businesses to set their own prices and enter into contracts by opposing government price controls and new regulations governing private business contracts.
Opening more opportunities for small businesses to sell to the 95% of the worlds consumers who live outside the United States by expending free trade opportunities.

However, the Biden Administration is providing its guidance along these lines.

Expanding access to low cost loans and investments. The Treasury Department is working with all states and territories plus 400 Tribal governments on standing up small business lending and investment programs as part of the $10 billion State Small Business Credit Initiative (SSBCI) established through the ARP. By this summer, the first wave of programs will launch, unlocking billions of dollars in new lending and investment capital for small businesses in big cities and small towns across America. Small businesses can also continue to access the Small Business Administration’s (SBA) traditional 7a, 504, and microloan programs, which collectively reached record high loan volume in Fiscal Year 2021 by providing $44.8 billion through more than 61,000 loans.
Increasing access to billions of dollars in federal contracts for small businesses. Last year, the Biden-Harris Administration announced its strategy for increasing the share of federal procurement dollars going to socially disadvantaged businesses by 50% by 2025. President Biden’s Bipartisan Infrastructure Law also includes a historic procurement effort designed to support small businesses and tackle long standing inequities in the contracting system. Among other things, the legislation directs DOT to attempt to award more than $37 billion in federal contracts to small disadvantaged business contractors.
Helping small businesses hire new employees and reach new customers by providing universal broadband. Broadband internet is necessary for Americans to do their jobs, and it is increasingly important for small business owners nationwide. President Biden’s Bipartisan Infrastructure Law will invest $65 billion in broadband infrastructure to ensure that every American has access to reliable high-speed internet, creating new opportunities for small businesses across America.
Connecting small businesses to the resources they need to grow and succeed. The SBA Community Navigator program launched last year and is deploying trusted messengers in underrepresented communities to offer small businesses a broad array of support services. The Bipartisan Infrastructure Law made the Minority Business Development Agency (MBDA) permanent, elevated its Director to Under Secretary of Commerce, and gave the agency more tools and authority. SBA also recently launched the Small Business Digital Alliance, a public-private partnership aimed at providing small businesses with critical tech resources to start and expand their e-commerce businesses, with an eye toward scaling for success.