Entrepreneurship plays a vital role in an economy, creating significant numbers of new jobs each year. Entrepreneurs—the term generally means to undertake—are individuals who create new businesses, products, or services. And they assume and manage the risks of their ventures. Recent studies, notably one by the accounting firm Ernst and Young, reveal good news and bad news for the nation in the global entrepreneurial arena. The good news is that the United States is still a beacon of entrepreneurial activity, leading the rest of the G20 nations, the largest industrialized countries of the world. The bad news is that the rate of new business growth still lags pre-recession levels. And, unfortunately, the rest of the world is catching up. Several factors contribute to the dominant role we have enjoyed thus far. Noteworthy is the entrepreneurial culture that exists here. Ours is still a nation embodied with the pioneer spirit. Second, the U.S. is still a leader in innovation, thanks to a large network of universities and research institutions. Only Japan outpaces the United States in rate of innovation. A third reason for our past supremacy is the role of the Small Business Administration (SBA). The SBA has a number of programs that focus on entrepreneurship, including $2 billion devoted to incubation programs. Several obstacles inhibit the growth of new businesses. Most critical is the tax and regulatory climate. Our corporate tax rates are the highest among the G20 nations. Myriad red tape and excessive regulations hamper start-up firms. Another limitation lies in the paucity of science and mathematics graduates. We continue to lag other G20 nations in this regard. And this constrains the pool of potential start-up talent. It is imperative that actions be taken to encourage new business activity. Policies must be initiated to reduce the current level of uncertainty firms face regarding taxes and regulations. Moreover, the corporate tax rate should be reduced to a level competitive with other nations. In addition, policymakers need to find ways of encouraging young people to study math, science, and engineering. A system of incentives might be established to encourage them. If these initiatives don’t take place, fewer people will engage in new business creation. And the nation will suffer. ______ Wayne Curtis, Ph.D., a former superintendent of Alabama banks and Troy University business school dean, is retired from the board of directors of First United Security Bank. Email him at wccurtis39@gmail.com.
