Velázquez on “How Entrepreneurs Can Lead Our Recovery”

Velázquez on “How Entrepreneurs Can Lead Our Recovery”

Washington, DC – Rep. Nydia M. Velázquez (D-NY), the Ranking Democrat on the House Committee on Small Business, delivered the following statement today at a hearing titled, “A Job Creation Roadmap: How America’s Entrepreneurs Can Lead Our Economic Recovery”:

“Our nation’s 29 million small firms are the cornerstone of our economy. They employ half of all private sector employees.  Over the past 15 years, they generated two-thirds of new jobs.  Clearly, given these facts, entrepreneurs will be essential to our economic recovery. 

“All small businesses help the economy grow, but it is the “opportunity entrepreneurs” that hold the most potential for job creation. These new, fast-growing firms, develop cutting-edge products, often revolutionizing entire industries.  Encouraging these innovators to turn their dreams into reality benefits the entire economy.  By creating brand new markets and sparking competition, these firms often have a multiplier effect on job creation.  As older businesses seek to compete in newly created markets, they, too, add workers to their payrolls.

This spirit of entrepreneurship has always been part of our national identity -- and remains so today.  In fact, approximately 565,000 new businesses per month were created in 2010 – the highest level over the past decade.  During today’s hearing, we will examine how these innovators are contributing to our recovery – and the hurdles they face in creating new jobs.

“Before the recession, starting a business simply required a good idea, hard work and Internet access.  But in today’s turbulent times, forming a business is more challenging.   The financial crisis presented a unique set of challenges for small firms seeking capital.  As lending standards tightened, entrepreneurs found it more difficult to secure loans and lines of credit.  While this situation has improved, there is still a long way to go.  SBA’s loan programs have played a critical role in bridging these gaps, providing startups with access to capital they need to launch and expand.

“Another area critical to businesses’ success is technical assistance.  SBA’s programs assist entrepreneurs by providing tailored education on topics ranging from marketing, to procurement, to international trade.  For a startup, this expertise can often make the difference between failure and long-term growth.  Initiatives like the Small Business Development Centers have proven effective in channeling counseling and assistance to millions of entrepreneurs across the country. 

“While the SBDC network is the SBA’s largest such program, it faces challenges in the form of reduced budgets and rising demand for its services.  Today, we will hear how the SBDC network is adjusting to these fiscal realities -- and what can be done to help it carry out its mission of assisting small firms.

“Startups and small businesses are critical to our nation’s long term prosperity.  Currently, this sector’s growth is largely fueled by immigrant entrepreneurs and older professionals launching new ventures.  As the face of entrepreneurship changes, strategies for supporting these ventures must also evolve.   Today’s hearing will provide the committee insights into how to tackle this challenge, identify areas where entrepreneurs face the greatest obstacles and help the Committee craft practical solutions to these problems.

“In advance of their testimony, I also want to thank all the witnesses for participating.  Your testimony provides valuable insight into these critical topics and we appreciate your being here.     With that, I thank the Chairman and yield back.”

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