How the Small Business Jobs Act Affects Entrepreneurs

I am thrilled to be a new member of the JumpStart team, as well as a new contributor to the blog. In my role as Market Analyst, I have been tracking federal and state legislation to facilitate JumpStart's understanding of the programs that might benefit our entrepreneurs. For starters, I wanted to understand how the enactment of the Small Business Jobs Act would affect entrepreneurs. Signed into law on September 27 2010, the Act includes $12 billion in tax breaks for small businesses and a $30 billion Small Business Lending Fund. Although the passage of this bill will not single-handedly bring the country's current 9.6% unemployment rate back down to more normal levels or create the eight million jobs that were lost between the end of 2007 and the beginning of 2010, the aid package represents a milestone for entrepreneurs and small business owners. The federal aid package has begun filtering down to the state level. In Ohio, for instance, Senator Sherrod Brown reported that 48 small businesses throughout the State have been awarded a total of $17.3 million in federal loans. Ohio is also set to receive $55.1 million in federal funds that will be used to help provide financing for manufacturers, minority entrepreneurs, and other small businesses, and the State is preparing a new website that will connect small business owners with lenders. This Act does operate through community banks, and so it will ultimately benefit established, small businesses that are probably growing at a rate slower than the typical JumpStart client. As a result, the Small Business Jobs Act alone will not alleviate the challenge of providing capital needed by high-risk startup and early-stage companies, which often do not have enough collateral to secure a loan and aren't ready to generate revenues yet. The Act's eight tax credits, which include a $10,000 deduction for startup expenditures and a self-employment deduction for health insurance costs in 2010, will certainly provide relief to entrepreneurs and small business owners, but they may not provide enough incentive to drive mass business expansions or growth. While the passage of this bill represents one step in the right direction, there are many left to go. Northeast Ohio's transformation, as well as the progress of its entrepreneurial ecosystem, has garnered so much national attention that JumpStart has been asked to sit at the table and participate in national discussions on innovation and entrepreneurship. Ray Leach, JumpStart's CEO, was selected as a member of the National Advisory Council on Innovation and Entrepreneurship (NACIE), a group that will provide recommendations for policies that foster entrepreneurship, drive economic growth, and create jobs. Ray is also leading the Economic Development Administration's Regional Innovation and Acceleration Network (RIAN), a network that connects practitioners across the country to share best practices in the creation and growth of high potential, high impact companies. Public policy and federal and state governance shape our nation's entrepreneurial ecosystem. Please continue to look for my blogs and read my thoughts regarding federal and state programs that support the creation of a national entrepreneurial economy. Leah’s primary focus as JumpStart’s Market Analyst is developing a deep understanding of the key challenges and opportunities facing entrepreneurs and early-stage companies. Using her experience leading research projects and framing problems to identify creative solutions, Leah works to build stakeholder relationships, ensure the growth and success of client and portfolio companies, and drive organizational strategies. Additionally, Leah brings her insights to life through communications and advocates for and connects entrepreneurs to additional capital and service resources beyond those provided by JumpStart.