February 19, 2021
Supporting Entrepreneurs Elevates Our Communities
This week celebrates National Entrepreneurship Week, which highlights the work done by entrepreneurs across the country.
Our state is home to a number of thriving businesses started by determined individuals who had a vision and boldly pursued their dreams. We are proud to recognize Arkansas entrepreneurs for their efforts to create jobs in our communities and the pride they bring to our state.
Entrepreneurs and small businesses are the backbone of our economy. Since the beginning of the pandemic, Arkansas small-business owners have found innovative ways to keep going and help their communities. But today, they face more complex challenges than one could have ever predicted. Innovation spurs economic development, and we have seen this firsthand in Arkansas, where small businesses have kept our economy afloat despite the many hardships they have faced. When we get our economy back on tract, we must continue to support our entrepreneurs and small businesses.
In Arkansas, almost half of all workers are employed by small-business owners, and 99% of businesses in our state are small businesses. Historically, startups create virtually all new jobs in the economy. For example, these businesses created more than 10,000 jobs in Arkansas in 2019 alone. But over the last year, and in the years before the pandemic, the market share of startups has decreased. As a result, the jobs they bring into the economy has also decreased.
Our country is experiencing a “startup slump,” with fewer people taking the plunge to start their own businesses. In all 50 states, the rate of new startups is at a 40-year all-time low. To make matters worse, more than 50% of small-business owners will not reopen their doors on the other side of the COVID-19 pandemic. In fact, more than 100,000 small businesses have already had to close permanently. The startup slump existed before COVID-19, and we worry about what the entrepreneurship landscape will look like after our country emerges on the other side.
Experts have offered several explanations for the “startup slump” including:
- a lack of access to capital, especially for underrepresented communities
- risk aversion and fear that have persisted following the economic downturn of 2008, and
- the difficulties of new businesses to break through in concentrated industries, to name a few.
To fix this problem, it is imperative that we understand what has caused these issues for entrepreneurs and craft solutions that create jobs and support business owners. We need to ensure that our country does not lose its entrepreneurial spirit. We simply must support startup founders, small-business owners and their families.
What We’re Doing
For these reasons, my good friend and longtime business partner, Jeff Amerine, co-authored the book “Creating Startup Junkies: Building Sustainable Venture Ecosystems in Unexpected Places” with me, Jeff Standridge, underscoring these concerns and highlighting the unique proposition of creating sustainable entrepreneurial ecosystems in unexpected places.
Furthermore, in the House of Representatives, I, Congressman Hill, plan to reintroduce the Enhancing Entrepreneurship for the 21st Century Act. This bill directs the U.S. Department of Commerce to identify and analyze the reasons behind the startup slump, address declining numbers, and help get more Americans on track to startup success.
Additionally, as co-chairman of the House Entrepreneurship Caucus, I, Congressman Hill, will continue to work with my colleagues on both sides of the aisle to seek ways to better support our entrepreneurs, identify and address issues they face, and remove barriers to the entrepreneurship journey.
Having spent several decades working in business, we are actively confronting this challenge from both the public and private sectors and we are proud to represent Arkansas and the businesses here that continue to operate in the face of extreme adversity. We are committed to working every day on behalf of Arkansas small-business owners and their families. As we continue to recover from COVID-19, it is important that job creators have the resources and support they need to keep our economy moving and get Americans back to work.
French Hill represents Arkansas’ Second Congressional District and is co-chair of the House Entrepreneurship Caucus.
Jeff Standridge is the managing director of Innovation Junkie and The Conductor as well as former vice president of Acxiom Corp.