Entrepreneurs and Small Business Have a Say on Job Creation By Danita Blackwood

More businesses are struggling and shedding workers as the number of uninsured Americans is now at an all-time high with millions of people without employer-provided insurance. The newest numbers from the Census Bureau also reveal the number of Americans in poverty is at the highest level since 1983, with about 46.2 million people, or nearly 1 in 6, Americans living in poverty in 2010.  These discouraging snapshots of the economic suffering across the nation come as President Barack Obama is promoting a $447 billion American Jobs Act to stimulate job creation and get businesses expanding.  The White House plan includes tax initiatives aimed at businesses:

• Cutting the payroll tax in half for 98 percent of businesses: The President’s plan will cut in half the taxes paid by businesses on their first $5 million in payroll, targeting the benefit to the 98 percent of firms that have payroll below this threshold.
• A complete payroll tax holiday for added workers or increased wages: The President’s plan will completely eliminate payroll taxes for firms that increase their payroll by adding new workers or increasing the wages of their current worker (the benefit is capped at the first $50 million in payroll increases)
• Extending 100% expensing into 2012: This continues an incentive for new investment.
• “Returning Heroes” hiring tax credit for military veterans: This provides tax credits from $5,600 to $9,600 to encourage the hiring of unemployed veterans.

While some economists are offering a primarily positive review of the President’s American Jobs Act; small business owners are calling on the Obama administration and congressional leaders to boost job creation by increasing access to credit, repealing the employer mandate in the health care law and ensure long-term tax certainty for small business owners are included in any job creation-related legislative measures.  Some entrepreneurs say for the nation to return to prosperity and real job growth the plans must go beyond incentives for expansion of low-paid workers in service industries.  For example, award winning business owner Josh Linkner wants to see an emphasis on innovation; “What the Obama plan needs to do is encourage entrepreneurship and innovation above all else. Providing incentives for McDonalds or Exxon to add yet another low-paid worker is not going to restore our country to greatness.” 

Linkner is not only the CEO and Managing Partner of Detroit Venture Partners, but also Adjunct Professor of Applied Creativity at the University of Michigan.  He is the founder, chairman and former CEO of ePrize.  Linkner is the founder and former CEO of three other successful technology companies and believes an emphasis should be on start-ups and innovation: “Breakthrough innovation which keeps our country relevant on the world stage most often comes from scrappy upstarts rather than bureaucratic sleeping giants. Incentives to spur job growth in small business, investment in R&D, and retraining our workforce for the ‘digital age’ are critical components to putting our country back to work " Linkner added.

Another small business leader believes there are some important components missing in the latest White House plan.  Dan Danner, the president and CEO of theNational Federation of Independent Business, was disappointed after Obama’s address to a joint session of Congress: “His plan does not address the fundamental problems facing small business today. In addition, recent history tells us that a huge federal stimulus program is the wrong approach, and again sends the message that the president thinks he can spend his way out of this recession.”  NFIB’s chief believes small business owners want less government from Washington: “The truth is that small businesses need the government out of their way. Tax breaks are always a welcome help to small businesses, especially in these tough economic times. But those outlined tonight by the president are temporary, and avoid the question of meaningful business tax reform. Lack of sales is still a major concern and there is a great deal of uncertainty among small businesses thanks to the threat of higher taxes and the thousands of pending federal regulations.”

Business owners represented by the International Franchise Association are also weighing in on job stimulation.  The IFA is calling on the Obama administration and congressional leaders to boost job creation by increasing access to credit, repealing the employer mandate in the health care law and providing for long-term tax certainty for small business owners are included in any job creation-related legislative activities moving forward.  One franchise business leader, John "Jack" Earle, CEO Earle Enterprises, a multi-unit franchisee and current IFA Chairman, heard the president’s speech as a guest of House Speaker John Boehner. Earle says uncertainty about future regulations is hurting job creation; "Costs associated with the employer mandate provision in the health care law, uncertainty regarding the future of tax rates beyond 2012 and difficulties accessing credit in the current regulatory environment are crippling the ability for franchised small business owners like myself to create jobs."

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