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Archive for the ‘small business and entrepreneurship’ Category

Job Lock and Employer-Provided Health Insurance: Evidence from the Literature

May 20, 2015 Comments off

Job Lock and Employer-Provided Health Insurance: Evidence from the Literature
Source: AARP Public Policy Institute

This report, written by Dean Baker at the Center for Economic and Policy Research, reviews the research literature on health insurance-related “job lock”—a labor market pattern that occurs when workers are reluctant to leave a job that offers health insurance because they cannot otherwise obtain affordable insurance. Based on the research, the author concludes that the Affordable Care Act’s insurance market reforms should have substantial, positive labor market effects.

The report reviews the research on three types of job lock:

  • Workers remaining in jobs in which they are not satisfied because of the fear of not being able to get health insurance at a new job (or not being able to buy or afford it in the individual market);
  • Workers being reluctant to start a business because they do not want to lose employer-provided health insurance; and
  • Workers staying employed (or employed full time) in order to obtain employer-sponsored insurance, when they would otherwise prefer to retire or work part time.

All three types of job lock are likely to be reduced by the Affordable Care Act, resulting in important gains for workers, families, and the economy.

Demographic Characteristics of Business Owners and Employees: 2013

May 4, 2015 Comments off

Demographic Characteristics of Business Owners and Employees: 2013 (PDF)
Source: U.S. Small Business Administration

Business owner characteristics and the economic and business environment are changing. Small business owners and entrepreneurs make important contributions to business creation and growth in the American economy. Understanding the characteristics of business owners and how they differ from employees is important for measuring the overall economic well-being of the economy including the economic incentives for entrepreneurship. This issue brief examines business owner demographic characteristics in 2013 and compares these characteristics to those of employees in the U.S. economy.

Harnessing Immigrant Small Entrepreneurship for Economic Growth

April 28, 2015 Comments off

Harnessing Immigrant Small Entrepreneurship for Economic Growth (PDF)
Source: Bread for the World Institute

Immigrant-owned small businesses generate $776 billion in business activity and sustain 4.7 million employees—14 percent of all workers employed by U.S. small business owners. While 13 percent of the U.S. population was born outside the United States, 18 percent of small business owners are foreign-born. But there are few specific policies at the national or local levels supporting the potential of immigrant small entrepreneurs to reduce poverty and spur economic growth.

This report identifies challenges for small immigrant entrepreneurs and promising practices to better support them in three case study sites: Miami, Florida; Des Moines, Iowa; and Salt Lake City, Utah.

President Obama’s November 2014 executive action granting deferred deportation and work permits to millions of unauthorized immigrants offers a unique opportunity to expand the power of immigrant small entrepreneurship to boost local economic growth. But to realize this potential, immigrants need better access to finance, culturally relevant business training, and a path to permanent legalization.

Using the Internet to Promote Services Exports by Small- and Medium-Sized Enterprises

April 23, 2015 Comments off

Using the Internet to Promote Services Exports by Small- and Medium-Sized Enterprises (PDF)
Source: Brookings Institution

This paper discusses the importance of services exports for the U.S. economy. In this context, the paper analyzes how export promotion agencies (EPAs) can use the Internet to grow services exports by small- and medium-sized enterprises (SMEs).

The first part of this paper discusses how engaging in international trade benefits services SMEs and the U.S. economy. Part 2 provides an overview of the barriers faced by SME service firms in using the Internet to go global and analyzes the different ways that SMEs use the Internet, from reaching consumers globally, communicating with suppliers, to becoming part of global supply chains. Based on interviews and an online survey with export promotion agencies (EPAs) in the U.S. and select other countries, Part 3 describes how EPAs are engaging service SMEs and assisting them in using the Internet to become international traders. Part 4 draws on the experiences of EPA support for SME services exporters and recommends how to scale up some of these approaches in ways that would have a broader impact on SME services exports.1 The paper concludes with thoughts on future research.

Equity-based Crowdfunding: Potential Implications for Small Business Capital

April 22, 2015 Comments off

Equity-based Crowdfunding: Potential Implications for Small Business Capital (PDF)
Source: U.S. Small Business Administration

For small business owners and entrepreneurs to build, grow, and support their business, it takes capital, and today, many of these individuals are choosing alternative forms of capital. One popular avenue is crowdfunding. “Crowdfunding systems enable users to make investments in various types of projects and ventures, often in small amounts, outside of a regulated exchange, using online social media platforms that facilitate direct interaction between investors as well as with the individual(s) raising funds.” There are three basic types of crowdfunding. Money is given in exchange for a clearly defined good (reward), a piece of the venture (equity), or a loan agreement (peer-to-peer). Typically, these three types of crowdfunding occur on different types of websites or platforms. Today, crowdfunding is steadily reaching critical mass as it is now estimated to be worth $3 billion to $5 billion worldwide.

Despite the growth of crowdfunding in the alternative lending landscape, one major crowdfunding method remains untapped. Equity-based crowdfunding was created under Title III of the Jumpstart Our Business Startups (JOBS) Act (2012), but the rule under Title III is still being written at the Securities and Exchange Commission (SEC) to expand the ability for entrepreneurs to sell equity to prospective investors online. Until the SEC issues final rules under Title III, equity-based crowdfunding for the vast majority of Americans remains off-limits.

CRS — Small Business Administration Trade and Export Promotion Programs (February 3, 2015)

April 21, 2015 Comments off

Small Business Administration Trade and Export Promotion Programs (PDF)
Source: COngressional Research Service (via National Agricultural Law Center)

According to Census Bureau data, approximately 1% of small businesses in the United States currently export. With roughly three-quarters of world purchasing power and almost 95% of world consumers living outside U.S. borders, more attention is being paid to the potential of small business export promotion programs to grow small businesses and contribute to the national economic recovery. In addition, some Members of Congress believe the contributions of small businesses to commercial innovation and economic growth could be enhanced through greater access to growing international markets.

Consistent with these policy goals, the Small Business Administration (SBA) provides export promotion and financing services to small businesses through its loan guaranty programs, management and training programs, and other initiatives. SBA’s Office of International Trade (OIT) coordinates these activities as it assists with four stages of export promotion: (1) identifying small businesses interested in export promotion; (2) preparing small businesses to export; (3) connecting small businesses to export opportunities; and (4) supporting small businesses once they find export opportunities.

CRS — Small Business Administration: A Primer on Programs and Funding (February 3, 2015)

April 21, 2015 Comments off

Small Business Administration: A Primer on Programs and Funding (PDF)
Source: Library of Congress (via National Agricultural Law Center)

The Small Business Administration (SBA) administers several types of programs to support small businesses, including loan guaranty and venture capital programs to enhance small business access to capital; contracting programs to increase small business opportunities in federal contracting; direct loan programs for businesses, homeowners, and renters to assist their recovery from natural disasters; and small business management and technical assistance training programs to assist business formation and expansion.

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