What you can do to help small business
Small businesses face considerable challenges, yet, they are an important engine for job creation. Here are a few things the public can do to support local small businesses.
My previous column offered advice to entrepreneurs on how to cope with the tough economic times that seem to have become the "new normal" for the American economy.
The latest nationwide poll of small-business owners by the National Federation of Independent Business supports what I am hearing from the entrepreneurs I work with in Middle Tennessee.
The NFIB Index of Small Business Optimism lost 3.2 points in June, falling to 89.0 after posting modest gains for several months. Entrepreneurs seemed to have been wishing for good times to come over the past few months, but now they seem to be facing the reality that things are going to be tough for some time.
Most of the decline in the NFIB Index of Small Business Optimism is due to deterioration in the outlook for business conditions in general and the realization that sales won't be improving any time soon for small businesses. Owners have no confidence that economic policies will fix the economy.
This is very worrisome, as small businesses accounted for 77 percent of all new job creation for the 20 years leading up to this recession. Entrepreneurs have led the way in job creation in almost every past recession.
Public can make a difference
So what can we do as individual citizens to help support small-business owners and help them face the challenges of their entrepreneurial journey? Here are two simple steps to consider:
First, remember the New Year's resolution I suggested at the outset of 2010 -- support small-business owners with your business. When you have a chance to choose an independent small business for a purchase, please make that choice. They need your support and with it you can do your part in helping improve their sales, which eventually will encourage them to start adding new jobs.
Second, when you vote, look for candidates who truly want to support small business. This has nothing to do with party affiliation. And it has nothing to do with "I want to help entrepreneurs" rhetoric in campaign speeches.
We know from research around the globe that cutting income tax rates increases business startups -- and that these new ventures are what create the most new jobs.
Cutting tax rates also leaves more money in the pockets of American citizens, which can then be spent with small businesses.
We also know that regulation has been choking small businesses. Small businesses spend more than 50 percent more per employee complying with regulation than their large-business competitors. This stifles their ability to fund growth. And without growth they cannot create new jobs.
Look beyond what letter is after politicians' names and take the time to learn their records.
There are no quick fixes in this economy. If entrepreneurs persevere, and we all do our part to support them, our economy will eventually improve. Together we can rebuild sustained growth that will soon begin to add jobs and return us all to prosperity.
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