Whenever small businesses are asked about their biggest challenges, taxes, accessing capital, and hiring are always at the top of the list. Regulation, too, is typically cited as a big concern, and a new study last week shed additional light on the regulatory headache that continues to cause small businesses and entrepreneurs pain. The study from Babson College also identified some other challenges that are very fixable with the right leadership.
Babson polled 10,000 small firms, with help from Goldman Sachs, and found that the regulatory environment creates a three-headed monster for business.
We understand completely that compliance creates serious drag, and that it especially hurts smaller small businesses. The government affiliated nonprofit SCORE says companies with fewer than 20 employees have 60 percent higher compliance costs.
Given the small business sector accounts for 63 percent of all net new jobs created, and “job losses from start-up closures are also significant and reduce the overall net employment gain,” as the study notes, there has to be greater focus by both the private and public sectors to help small businesses succeed. That’s why we’ve made it our mission to make entrepreneurship easier. Yes, it helps us when startups grow. But helping a greater percentage of the 28 million small businesses scale their operations is essential for the entire economy.
Zenefits helps thousands of firms automate compliance, HR and benefits administrative with our free platform, and we are working in partnership with the U.S. Small Business Administration (SBA) and others to help deliver solutions that help small businesses grow and scale. For example, the Babson study also found that small businesses suffer from not knowing what affordable technologies are in the marketplace, and that they are in need of training for their staff on various fronts. We are excited to be addressing both of these challenges through the Small Business Technology Coalition and other small business resources across the country.
There is much to do and we look forward to finding new, impactful ways to help small businesses grow. If you have ideas, please share them with us!