Earlier this year, Klobuchar and Scott launched the bipartisan Senate Entrepreneurship Caucus to address the most pressing policy issues facing entrepreneurs and today hosted a Women’s Entrepreneurship Roundtable to encourage new business founders
As new business formation rates in the U.S. have fallen near a 40 year low, the Enhancing Entrepreneurship for the 21st Century Act would require a collaborative effort between all relevant government agencies to produce a comprehensive study into the underlying factors driving the current “startup slump”
WASHINGTON – Today, the Co-Chairs of the Senate Entrepreneurship Caucus, U.S. Senators Amy Klobuchar (D-MN) and Tim Scott (R-SC) introduced the bipartisan Enhancing Entrepreneurship for the 21st Century Act. As recent research has demonstrated that rates of Entrepreneurship in the U.S. have fallen near a 40 year low, the Enhancing Entrepreneurship for the 21st Century Act would require the Secretary of Commerce to work with partners at all relevant government agencies to conduct a comprehensive study into the underlying factors driving the current “startup slump.”
“Entrepreneurs are the innovators driving economic growth, but fewer and fewer new businesses are launched every year,” Klobuchar said. “This legislation would allow us to identify and evaluate the reasons for the lag in new business formation. With a better understanding of the causes of this slowdown, Congress will be able to work with entrepreneurs across the country to stimulate innovation and create jobs to move our country forward.”
“From going door to door selling vacuums, to eventually owning my own insurance agency, I found out first-hand what it means to sign your name on the front of the check instead of the back,” Scott said. “Our job in Congress is to cultivate the soil conditions so job creators and entrepreneurs can flourish. This bill will ensure that the Executive Branch is doing everything it can to allow innovators to succeed and small businesses to grow.”
The Enhancing Entrepreneurship for the 21st Century Act is supported by the Center for American Entrepreneurship and the Small Business and Entrepreneurship Council.
“Strong entrepreneurship is central to America’s innovative and economic vitality, and addressing weak startup activity must be a priority for elected officials and business leaders across the United States. SBE Council applauds the leadership of Senator Klobuchar and Senator Scott for introducing the Enhancing Entrepreneurship for the 2st Century Act, which will help guide the development of effective policies and actions by uncovering and fully understanding the underlying causes of the startup slump,” said Karen Kerrigan, President & CEO of the Small Business & Entrepreneurship Council.
“Revitalizing American entrepreneurship and achieving the more robust economic growth the American people need and deserve requires informed changes in public policy – which, in turn, requires a rigorous understanding of the likely causes of declining rates of new business formation. The Enhancing Entrepreneurship for the 21st Century Act will contribute enormously to our understanding by directing the Secretary of Commerce to investigate the issue, bringing to bear all the data and analytic capacities of the Federal government. CAE thanks Senators Amy Klobuchar and Tim Scott for their leadership on this critical issue and looks forward to supporting the Secretary in this important endeavor,” said John Dearie, President of the Center for American Entrepreneurship.
Economists have identified several factors that may explain the reasons for the slowdown in entrepreneurship. These include demographic changes caused by an aging workforce, increased industry concentration, increased risk-aversion following the last recession, difficulties related to access to capital (particularly difficulties encountered by underserved populations, minorities, and women), the concentration of venture capital in only a few cites, record levels of student loan debt, and difficulties faced by entrepreneurs in making use of federally funded research and innovation.
In conducting the study, the Secretary will be required to consult with leaders and utilize key data sets housed at the Census Department, Bureau of Economic Analysis, Bureau of Labor Statistics, Treasury Department, Federal Reserve, and Small Business Administration—in addition to consulting with entrepreneurs and representatives from consumer, community, and entrepreneurship advocacy organizations. The Secretary will be required to consider each of the potential factors identified above and will be required to make distinctions between industries, which economists believe may be affected by disparate factors.
Earlier this year, Klobuchar and Scott launched the bipartisan Senate Entrepreneurship Caucus to address the most pressing issues facing entrepreneurs and serve as a forum for collaboration and coordination. The caucus will also serve as a clearinghouse for proposals from interested groups who wish to share their ideas with policymakers who are committed to supporting our nation’s entrepreneurs.
The caucus is supported by the Center for American Entrepreneurship (CAE), Economic Innovation Group (EIG), the U.S. Chamber of Commerce, Small Business Majority, the Ewing Marion Kauffman Foundation, the National Federation of Independent Business (NFIB), Main Street Alliance, the Small Business and Entrepreneurship Council, Small Business Investor Alliance, the American Investment Council, and the National Venture Capital Association.
The Senate Entrepreneurship Caucus is led by Co-Chairs Klobuchar and Scott. Caucus members also include Senators Roy Blunt (R-MO), Chris Coons (D-DE), Joni Ernst (R-IA), Lindsey Graham (R-SC), Maggie Hassan (D-NH), John Hoeven (R-ND), James Inhofe (R-OK), Doug Jones (D-AL), Jerry Moran (R-KS), Gary Peters (D-MI), David Perdue (R-GA), Kyrsten Sinema (D-AZ), and Bob Casey (D-PA).