Small business groups urge president to sign JOBS Act

Partisanship in Washington has risen to an all-time high and “politics as usual” has come to mean complete gridlock, where the most basic legislation falls flat because of political gamesmanship. That’s why the bipartisan jobs bill headed to the president’s desk for approval is such a breath of fresh air. The Jumpstart our Business Startups (JOBS) Act will do some real good for America’s entrepreneurs — our nation’s primary job creators who, with help from laws like the JOBS Act, can pull the country out of its financial stupor.
 
The JOBS Act addresses one of small businesses’ biggest problems: a lack of access to credit. Banks' loan portfolios have been reduced by more than $47 billion since the pre-recession peak -- and that affects business owners across the country. Recent opinion polling Small Business Majority released found 90 percent of small businesses say the availability of credit is a problem, and 60 percent have faced difficulty themselves when trying to obtain loans that would grow their business. Another 61 percent of small business owners said it is harder now than it was four years ago to get a loan. And according to National Small Business Association (NSBA) data dating back nearly 20 years, there is a direct correlation between access to capital and job growth — when capital flows more freely, small businesses add new jobs.

The bipartisan measures in the JOBS Act will increase capital formation, spur the growth of startups and high-tech ventures and pave the way for more small-scale businesses to go public, which can lead to more job creation within the company.
 

In particular, this bill would allow crowdfunding, or selling small amounts of stock to a large pool of individuals. This will especially benefit startups — which account for the lion’s share of new job creation. Crowdfunding allows entrepreneurs who lack access to traditional funding the opportunity to take their ideas directly to smaller investors, which will then allow individuals to invest in small businesses in their local communities. This will give more Americans the opportunity to run with their entrepreneurial ideas, instead of having to abandon their idea or sell it to a large corporation because they can’t get the capital they need to grow a viable business. 
 
This bill is by no means a perfect piece of legislation and stakeholders on both ends of the political spectrum have voiced concerns with some of its provisions. With that said, the fact that it has passed both chambers in this hyper-partisan environment is a huge step in the right direction. The credit crisis for small firms has reached its zenith, and we urge the president to sign this bill immediately. The JOBS Act isn’t a panacea for small businesses’ credit woes, but small businesses need all the help they can get. Now, more than ever, they need legislators to put their partisan differences aside and work together for small businesses’ benefit.
 
However, we strongly encourage legislators not to stop here. This bill will give startups a leg up, but existing brick-and-mortar Main Street small businesses need help, as well. There are too many mom-and-pop shops that need small loans, like $25,000 to build an addition onto their business or keep supplies stocked, and can’t get them because of tightened restrictions and a dried up credit market.
 
Only half of small business owners who sought loans last year were able to get them, according to a Pepperdine University study. That’s a pretty dismal figure, and it’s this credit barrier that directly prevents small business expansion and limits entrepreneurs’ ability to put America back to work. We encourage the administration and Congress to continue reaching across the aisle for the good of small business. The small business lending crisis has gone on far too long. We hope lawmakers can build on the bipartisan momentum and continue focusing on fixing the credit problem. Our job creators are counting on their help.

Arensmeyer is the founder and CEO of Small Business Majority.

McCracken is president of the National Small Business Association (NSBA).

The following business groups signed onto this piece:

Association for Enterprise Opportunity
Minority Business RoundTable
National Association for the Self-Employed
National Gay & Lesbian Chamber of Commerce
National Small Business Association
Small Business and Entrepreneurship Council
Small Business Majority
U.S. Black Chamber, Inc.
United States Hispanic Chamber of Commerce
Women Impacting Public Policy

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