Policies > Renewing America > Section 3

Supporting Small Business & Entrepreneurs

Small business is often referred to as the engine of the American economy. In 2019, small businesses accounted for 99.9 percent of American businesses, and 47.3 percent of American workers were employed by these firms, with businesses with fewer than 100 employees contributing the largest share of small business employment.

Entrepreneurs and startups are at the heart of this economic dynamism, but since the Great Recession, entrepreneurs have struggled to find access to capital to start new businesses at the same rates as before, and the startup rate has been sluggish, with more firms failing than launching each year in most metro areas. Notably in 2018, on net the economy added no additional firms for the first time in our nation’s history.

The economic crisis caused by the coronavirus pandemic has hit everyone, but small businesses bore the brunt of the economic impact. A shocking majority of small businesses report being adversely affected by the pandemic, with one report putting the percentage at 75 percent and another putting it as high as 91 percent.

Rebuilding a New Normal: Key Principles and Policy Goals

Guiding principle: Make the goal of recovery to create higher-quality jobs and close racial gaps, rather than building back toward the pre-COVID status quo.

  • Target Funding to Fill Gaps

    Target limited city and state funding to fill in gaps left by federal support, with a special focus on minority- owned businesses or other businesses and entrepreneurs who have historically struggled to access capital

  • Go Beyond

    Offer support beyond direct financial assistance

  • Invest in Economic Growth

    To drive the early recovery, ensure that entrepreneurship dollars are investing in the types of businesses that drive economic growth, such as tech startups and other businesses that are designed to grow quickly, and that these dollars are supporting an entrepreneurial ecosystem that reflects your city or state’s diversity.

  • Access to Capital

    Increase access to capital for entrepreneurs, especially those historically underserved by the banking and finance sectors

  • Future Flexible Federal Funding

    Advocate for future federal funding that is more flexible than the PPP, and that offers “second chance” lending for entrepreneurs who have had to shut their doors despite receiving aid in the initial round of federal support.

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