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Congress urged to modernize small business management programs

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Goldman Sachs, in the company of 10,000 Small Businesses, just published its report "From Pandemic to Prosperity: Bipartisan Solutions to Support Today's Small Businesses,” through which it seeks to revitalize and modernize government programs aimed at strengthening small businesses.

The new report urges Congress to revamp the Small Business Administration (SBA) for the first time in more than two decades, allowing the creation of support programs for small business owners that help them reinvent themselves and adapt to the new realities of the economy.

The report, a product of more than a year's worth of conversations between small business owners and representatives from Goldman Sachs and 10,000 small businesses, as well as government officials, highlights:

The urgent need for Congress to further support small businesses and reauthorize the SBA to address persistent challenges small business owners are facing, primarily: recruiting and retaining workers in a highly competitive environment, ensuring that employees have access to quality, affordable child care, accessing capital and competing for government contracts.

"Small businesses add to the economic vitality of our country, but outdated policies are holding them back. Our new report shows bipartisan solutions, like expanding access to retirement plans and investing in high-quality childcare, will advance economic growth,” David Solomon, chairman and CEO of Goldman Sachs, said in a statement.

For her part, Jessica Johnson-Cope, president of the 10,000 Small Businesses Voices National Leadership Council of Goldman Sachs and president of Johnson Security in the Bronx, New York, highlighted: "When Congress last reauthorized the Small Business Administration, Amazon was best known as the world’s largest river, and the iPhone was still seven years away from being introduced. It is imperative that Congress reimagines the role the Small Business Administration can play in reinvigorating America’s economy with modernized programs offering small business owners the support they need to succeed today – not the now seemingly-ancient economy of 20 years ago.”

Key aspects of the petition

In addition to the delay in financing models for these small businesses, the report points to four areas where it is necessary to intervene with policies to improve the conditions of competitiveness and development of these companies.

1. Workforce

The struggle to hire human talent and retain it in the face of larger companies is a fight between David and Goliath.

“The existing policy programs and incentives intended to address small business hiring and retention challenges often have low adoption because they are overly burdensome and complex,” the report says.

2. Child Care

Providing quality, affordable child care spaces, especially during the pandemic, has been an impossible mission for workers and small business owners alike.

“The cost of providing quality care exceeds what most parents and families can afford to pay — even with existing means of government support,” the report points out.

3. Access to Financial Aid

The report presents a clear example of the difficulties faced by small businesses, especially Black and Brown owned, to access credit and inject capital into their businesses. They highlight how “research has shown that Black-owned businesses deemed to be low credit risks are still less likely than other small businesses to receive all the financing they seek, driving the ambition/confidence gap.”

4. Opportunities in Government

The report warns that since the government requirement to contract with small disadvantaged or women-owned businesses was established in 1994, it has only been met twice.

“The simplification of government contracting is essential for the participation of small businesses,” underlines the report.

"Supporting small businesses as they move beyond the pandemic will require thoughtful, forward-looking policies designed to serve small business owners in today’s economy,” said Joe Wall, National Director of Goldman Sachs 10,000 Small Businesses Voices.

Click here to see the full report.

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