U.S. should remove small business hurdlesPublished 1:51pm Friday, June 15, 2012
I had a great meeting this week with a friend of mine from Tallahassee. This friend, after years of working in the financial services industry, walked away from his job in the midst of the economic downturn in 2009.
William Lamb knew his real passion was painting, art and creation, so he and his wife, Margaret, decided to take the leap of faith and become an entrepreneur. Now, his company, Wm. Lamb & Son, is a successful, growing family business. William designs and sells outdoor-related house wares and apparel.
If you look around Decatur County and Bainbridge, you’ll see many instances and situations similar to William’s. Forward-thinking businesspeople, with an opportunity to fill a void or provide a solution, have creating many successful businesses through the years, businesses that have provided many jobs and paid civic rent.
Sadly, those success stories of entrepreneurial start-up businesses are at an all-time low and, as a result, job creation from those new businesses has fallen proportionally.
According to a recent study conducted by Investors Business Daily, the national newspaper that covers global economic and financial issues, new business start-ups, as a percentage of all businesses, has fallen by almost 50 percent since the peak of the 1980s.
In 1987, 13 percent of all businesses were considered new, or start-ups, compared to only seven percent today. As a result, only two percent of annual job creation in the private sector is a result of new companies.
Why are those numbers falling so dramatically?
The answer comes from another study conducted by the Organization for Economic Cooperation and Development (OECD), the global group that studies international economic and business issues.
According to that study, today, it would have been easier for William Lamb to start and operate his business in Slovenia, Estonia, or Hungary than to start a company in the United States.
Does that mean there are more opportunities in those countries than in those other countries? Absolutely not. We are still, by a long shot, the land of opportunity and the destination goal for many business people worldwide. It does mean that we have a problem and needs to be addressed and corrected.
Due to the number of government-issued regulations and licenses required of new startups, the United States has fallen into a situation of hampering entrepreneurial growth rather than doing what is necessary: creating a growth-friendly environment for those who want to start a viable business and create jobs.
The lofty barriers to enter the marketplace, uncertain tax situations, uncertain health coverage requirements, and simply the amount of red tape required to start a business must be reduced or eliminated for us to grow and prosper.
Those facts and figures are staggering and must be reversed if we, as a nation, as a state, and as a community, hope to get back to a robust economy with everyone who wants to work, can work.
We cannot, and will not, get there by creating more government jobs—those positions simply cause a vicious financial cycle that gets us nowhere, except further in debt. The private sector, and new startup companies in particular, absolutely must be the area in which our economy grows.