The greatest natural resource any country has is the genius of its people. And here in the United States, that genius is plainly evident in the ways we create, invent, empower and innovate for the greater good.
America’s entrepreneurial spirit has always been foundational to our country and our economy, and in a 21st century global economy, it’s more important than ever before. In fact, between 1982 and 2011, nearly every net new job has come from businesses five years old or younger.
But we also know that net new business creation has plummeted more than 30 percent since the Great Recession, and it’s clear we need to be doing more to remove barriers to entrepreneurship, particularly for those Americans interested in starting small businesses. Small businesses are one of the most vital pillars of our economy, providing 55 percent of all jobs. However, the percentage of “very small” businesses started each year is at its lowest point in 30 years.
By removing barriers to entry for those traditionally excluded from starting and owning small businesses, we can expand opportunity for the communities they serve.
We know that veterans, for example, have unique skills and qualifications that make them highly successful small business owners. Veteran-owned businesses make up nine percent of all American businesses and the self-employment rate for veterans outpaces that of those with no military service. One study found that military experience is actually a higher indicator of someone’s likelihood to become self-employed than getting a graduate degree.
Meanwhile, minority owned businesses have grown at a much faster rate than non-minority owned businesses, yet it is still much more difficult for a Black or Latino entrepreneur to be approved for a loan than a white peer. Research has shown that minority owned businesses are about three times more likely to be denied a loan than a similar non-minority business.
The same is true for women owned businesses—between 2007 and 2016, women-owned businesses grew at more than five times the national average, and for the past twenty years, women-owned businesses have grown at twice the national average, yet women still face barriers in accessing capital, and those who do start their businesses start on average with about half as much founding capital as male businesses owners.
I have met with dozens of New Jersey small businesses owners who have expressed to me the challenges in accessing capital to start their businesses.
We could be doing so much more to match the skills and insight needed to succeed in business with public-private partnerships and opportunities to match entrepreneurs and startups with business incubators and accelerators. I’m proud to have introduced bills like the Startup Opportunity Accelerator Act and the STARTUP Vets Act, to help more entrepreneurs access the capital they need to start and build businesses that help our economy grow.
This Global Entrepreneurship Week, let’s pledge to do more to empower American entrepreneurs from across the country and all walks of life— that’s how we strengthen the middle class and extend prosperity to all corners of our country.