How Do We Get More Start-Ups?

27 Jan How Do We Get More Start-Ups?

This morning I read an interesting piece on SmallBizTrends.com titled “Will 2010 be the year of Start-Up America?” Melinda Emerson discusses how Obama should make start-ups the focus of his economic recovery plan in 2010, citing that small businesses have been responsible for 60-80% of annual job creation since the 1990s. She details 8 specific ways the government could assist in this effort, from wage subsidies to tax credits to plain old increased funding.

Small Businesses As Economic Saviors

While statistics can tell a lot of stories, I agree with Melinda’s point that small businesses are where most new jobs will come from as we come out of the recession and try to chip away at the 10% unemployment rate. Large corporations are under pressure to maintain profits and a lot of their gains are coming from cost-reduction efforts (aka layoffs, stretching employees, delaying new hiring). So how should we be going about it?

Government Intervention is NOT the Answer

The ideas that Melinda gives are great ideas and I believe they would be successful in helping a lot of start-ups. However, I couldn’t ignore the feeling that all of them centered on one key idea; the government’s increased interference in small businesses. Some of the ideas were intended to temporarily reduce government interference (payroll tax exemption, tax credits, etc.) while the others increased government involvement (whenever the government give you money they have to monitor how it’s used, so more regulation and red tape.)

Perhaps Melinda’s suggestions are more feasible, but I believe that small business creation will continue to lag in this country until the government reduces it’s role in the process. What do you think?

2 Comments
  • Melinda Emerson "Smallbizlady"
    Posted at 10:48h, 27 January

    Robert–

    Thank you for your insights. I do not believe that I am calling for government intervention, I am merely trying to redirect their efforts so that it will really help small business owners.

    To your business success,

    Melinda Emerson
    @smallbizlady

  • Alex McArthur
    Posted at 17:29h, 27 January

    Big business gets every possible advantage under the U.S government. The best thing that can be done is to provide a more even playing field. Obviously bigger companies will always have more resources and will spend more marketing dollars, spend more on R&D, have a better web presence, etc. However, many big businesses have ruined what was once a good thing (through a variety of ways such as over spending, knowing that big brother will pick up the check, stupidity, etc) and should be forced to face their mistakes on their own. That alone would force change in my opinion.