Castroville small business owner, Lori Krieger, recently shared a thought with me via Twitter – “When you buy from a small business, you’re not helping a CEO buy a 3rd holiday home. You’re helping a little girl get dance lessons, a little boy his team jersey, moms & dads put food on the table.”
It is a great reminder that small businesses are not just products and services. They are real people with big dreams, working hard behind their storefronts, both physical and digital. And the statistics show that these small business owners are having an out-sized impact on our economy.
There are 28 million small businesses in our country and they create 63 percent of the new jobs every year. More than 99 percent of all companies that have employees are small businesses and they employ almost half of all private sector employees. They contribute 46 percent to our private sector output and 98 percent of our nation’s exporters are small businesses.
These numbers are impressive in the aggregate. But if you know a small business owner, you know that what is truly impressive is how hard they work, usually every day of the week, to keep things running. Sacrifice is just part of the plan, and more often than not, their whole family contributes to making things work.
You help as well, every time you decide to “shop small” and “buy local.” As your Representative, however, I feel a responsibility to do even more. Small business owners visit my office in D.C. on a regular basis and their message to me is pretty consistent, no matter which industry they represent – “Get the government out of our way.”
As Chairman of the Information Technology Subcommittee, on a regular basis I see how government is stifling innovation and entrepreneurship. New and ever-increasing taxes keep business owners from being able to re-invest in their own company with research and development, improved infrastructure, hiring new employees or increasing wages and benefits in order to attract and keep talent.
But perhaps even more repressive than burdensome taxes is the constant stream of new red tape flowing out of our federal agencies. A restaurant owner recently shared that just trying to stay compliant with Obamacare regulations makes his Human Resources director want to tear out her hair. The cost of federal red tape in 2012 was more than $2 trillion according to the National Association of Manufacturers. Read that again – two trillion dollars.
Since 2008, regulatory costs have increased by over $808 billion according to the National Federation of Independent Business. Those are big numbers that would impact any company, but the toll this takes on small businesses in particular is daunting. For every 10% increase in regulatory compliance, there is up to a 6% decrease in the number of small businesses with 20 or fewer employees. Think about where you have shopped recently and how this impacts your neighbors and friends. These regulations close doors and even if owners learn, understand and stay compliant with these rules, that is money and time that could be better spent building the business.
This Congress has taken concrete steps to help small business owners, including making it easier for Veterans to take out small business loans, making the Research & Development tax credit permanent and repealing the oil export ban. The House also passed legislation that would repeal the Death Tax and the Employee Mandate in Obamacare, as well as force agencies to get approval from Congress before implementing any new regulations which would have a significant negative impact on our economy.
The iTeam, an Innovation Task Force I serve on in Congress, is working hard to reduce the regulatory burden on small business owners when it comes to technology. We have passed legislation that exempts small business broadband providers from onerous FCC reporting requirements, bans the FCC from telling small internet providers how much they can charge for internet access, and prohibits state and local governments from taxing internet access. I have also partnered with Google and Facebook for events in the district to help local business owners learn about how to best utilize online resources to advertise and grow their business.
The environment created by the federal government should foster innovation, entrepreneurship and job growth for small businesses, not stifle it. I salute the brave folks who continue to work hard every day to keep their business running, despite the burdens put on them by the federal bureaucracy. And I promise to keep battling the bureaucracy on their behalf, giving small businesses the best chance possible to survive and thrive. After all, little Vivian Krieger is going to need ballet shoes soon.