CSG State Entrepreneurship Days Focus on Helping New Businesses
By Jennifer Burnett, CSG Program Manager for Fiscal and Economic Policy
The issues that state leaders from across the political spectrum can agree on are rare, but the promotion and cultivation of homegrown entrepreneurs might just be one of them. State leaders know entrepreneurs help drive the economy forward and not only create jobs, but also contribute to an increase in wages and standards of living.
“The formation and growth of new businesses is the fundamental source of job creation and innovation in every U.S. state,” said Dane Stangler, vice president of research and policy at the Ewing Marion Kauffman Foundation.
Yasuyuki Motoyama, a senior scholar for policy and research at the Ewing Marion Kauffman Foundation, agrees. He told CSG’s Capitol Ideas magazine that new companies likely will be the ones bringing new jobs to the U.S. economy, and most of those will come through entrepreneurs.
“It has been demonstrated that the companies under five years old basically have created all new jobs in this country in the last 30 years,” Motoyama said.
But bringing a new product or service to market can be a daunting prospect for innovators—from gaining access to capital to navigating the legal and regulatory landscape. State policies can either hinder or foster that entrepreneurial spirit.
“Policymakers should continue to examine their state’s environment for business creation and identify barriers that may hinder entrepreneurship,” said Stangler.
While policies aimed at removing or reducing hindrances to entrepreneurial activity may be a key component of a state’s plan, Stangler said those policies aren’t the only way to improve the startup environment.
“It is also important for policymakers to look for positive steps they can take to help entrepreneurs, not just ways they can remove barriers,” said Stangler. “Laws and regulations can be used to make new business creation easier and to promote competition so entrepreneurs can operate on a level playing field with existing firms.”
Motoyama also cautions that, while states should always be on the lookout for new ways to help entrepreneurs, not everything a state does will help grow jobs. According to Motoyama, entrepreneurs aren’t like a business that needs to be lured to an area. Most will start their business in the community in which they live, and it turns out that tax rates don’t really matter for these business people.
“What matters is the tax code—how complicated it is,” said Motoyama. “That seems to affect the entrepreneur’s perception of the business climate.”
Stangler, Motoyama and other experts, practitioners and national thought leaders will be discussing these issues and more during the upcoming series, CSG State Entrepreneurship Days.
The series, hosted by CSG and the Ewing Marion Kauffman Foundation, will bring experts to four states to explore state-based solutions for increased entrepreneurship and stronger, more successful startups. Attendees will learn about the latest research on the importance of entrepreneurship to economic growth and innovative policy strategies to encourage entrepreneurship.
Entrepreneurship days will be held March 24 in Phoenix, April 1 in Hartford, Conn., April 2 in Lincoln, Neb., and in May in Memphis, Tenn.
To register for a session or learn more about these days, visit The State Entrepreneurship Days webpage.