Jobs are certain to be a topic of national interest in the upcoming presidential race, and both Hillary Clinton and Donald Trump should articulate more than just platitudes about increasing jobs and growing the economy. News that only 38,000 new jobs were added nationally in May is a real cause for concern that should resonate with large portions of the electorate. The road ahead appears to be rocky, too. The most recent Wall Street Journal survey of academic, business and financial economists reveals a sobering picture, projecting only 155,000 jobs per month over the next year (about 1.9 million annually). If this forecast proves to be accurate, this will be the worst year for job growth since 2010.
Against this backdrop are new data from Babson College, one of the leading teaching and research centers focusing on entrepreneurship. The Babson report focuses on a critical source of job creation: the small business community. It notes that small businesses (those with fewer than 500 employees) employ nearly half of our workforce and account for more than 60 percent of the private sector’s net new jobs. Taken together, these numbers underscore the fact that any specific plan to stimulate greater job growth must begin with the small business sector.
Yet small business often receives too little attention from federal policymakers, including those responsible for technology issues. The Federal Communications Commission (FCC), for example, has focused virtually all its attention on broadband network growth to residential environments. No one systematically collects data segmenting broadband availability and utilization by small businesses, so it is difficult to assess the existence of a new type of digital divide based on business size.
Small businesses face persistent problems regarding access to capital and inflexible loan terms. The majority of the Babson survey’s respondents also articulated some level of difficulty in understanding and managing government regulations and laws. These are familiar problems that need to be addressed, but perhaps the most immediate attention should be devoted to the technology challenges that this sector faces.
The report indicates that nearly 80 percent of the survey’s respondents recognize the importance of technology to the growth of their businesses. They are particularly sensitive to cost-related issues as their most significant technology issue, encompassing both initial costs and ongoing expenses for upgrades, maintenance and training. Cybersecurity and the protection of intellectual property also rank high on their list of technology challenges. Over 40 percent feel ill-prepared to handle a cyberattack, and nearly 25 percent have actually experienced one. A majority also lacks knowledge of how to adequately protect intellectual property assets, which are closely linked to productivity and competitiveness.
The role of government in setting new benchmarks for broadband network speed has attracted much attention, yet this policy emphasis ignores the more fundamental concerns of small businesses, which clamor for tailored solutions that address their operational concerns. Regardless of how the presidential candidates choose to specifically address job creation, state and local candidates will not be able to ignore small businesses in their home districts, where voters are more attuned to their needs.