Business in America News

Weekly Address: Helping American Businesses Succeed

President Obama discusses steps he's taking to ensure that more goods and products stamped "Made in America" are sold in the United States and around the world.

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Regional Roundup: Insourcing American Jobs

Yesterday, the White House hosted the “Insourcing American Jobs” forum with business leaders from across the country to discuss one topic: bringing jobs back to the United States.  For too long factories have closed their doors and companies have shipped jobs overseas, where workers were cheaper. It’s damaged the economy and hurt middle class families all across the nation.  The President believes we can change that. 

Right now, we have a great opportunity for those jobs to come back – and the business leaders that joined President Obama yesterday understand that.  We’re seeing an increasing trend of insourcing, where companies are bringing jobs back and making additional investments in America. Over the past two years American manufacturers have now added 334,000 jobs. Manufacturing production has increased by 5.7 percent. That’s a good thing, but we need to do more. That’s why the President called on companies to follow this trend and invest in America.  

The President is working to restore the economic security for the middle class and those trying to reach it. He’ll continue to build an economy where hard work pays off and responsibility is rewarded. He knows this is a make or break moment for the middle class, and he’ll continue to do everything he can to give folks a fair shot and a chance to succeed.  

He knows that America shouldn’t be a nation known for financial speculation and outsourcing. As he said yesterday, America should be known for making products and selling them all over the world stamped with three proud words: “Made in America.”  

The next generation of manufacturing jobs shouldn’t take root in countries like China or Germany – they should take root in cities across America. Some companies are already leading the way. Let’s take a look at news coverage of yesterday’s event from across the country: 

McClatchy/Charlotte Observer/Miami Herald - Rebuilding a business, bringing jobs back

WASHINGTON – North Carolina has lost tens of thousands of furniture-making jobs over the past decade. 

But Bruce Cochrane, who worked as a consultant in China and Vietnam after his family sold their furniture business in 1996, says rising Chinese wages and an increase in shipping costs have created an opportunity for him back home. 

Cochrane has invested $5 million and is hiring 130 workers to build middle- to higher-priced solid-wood furniture in the same sprawling Lincolnton, N.C., warehouse that his family once ran. He even moved into his dad’s old office. 

Now, President Barack Obama wants to know what Cochrane saw and why he’s taking such a chance in a region and industry battered by outsourced jobs. Cochrane stood Wednesday in the East Room of the White House as Obama said the Lincolnton man was proof that you don’t have to be a big manufacturer to make a difference. 

Resurgence of the American Auto Industry

Yesterday, the North American International Auto Show kicked off in Detroit, with companies unveiling their new vehicles and folks eager to get their first peek. Transportation Secretary Ray LaHood was on hand for the opening events, and Commerce Secretary John Bryson, Energy Secretary Steven Chu, EPA Administrator Lisa Jackson, and the Labor Department’s Director Office of Recovery for Auto Communities and Workers Jay Williams are all taking part in auto show activities this week. 

The auto industry had a strong year in 2011. It’s easy to forget, but just a few years ago many people doubted whether there would even be an American auto industry in 2011.

When President Obama took office, we faced the worst recession since the Great Depression, and the American auto industry was hit hard. Hundreds of thousands of jobs were lost in the auto industry, and entire communities that depended on a dealership or a parts manufacturer were affected.   

Both GM and Chrysler faced the stark choice of seeking government support or facing almost certain uncontrolled liquidations, which would have had a ripple effect across the industry, causing at least one million more jobs to be lost. The President refused to let that happen.

In the face of stiff opposition, the President made a tough choice to help provide the auto industry the temporary support it needed to rebuild their companies and get moving again. This was a difficult decision, and came with significant risk. But the President was not willing to walk away from these workers and this great American industry.

Today, the American auto industry is coming back, creating jobs and moving cars off the line. Last month, the automotive industry added nearly 11,000 positions, bringing the total number of jobs added in the fourth quarter of 2011 to 36,000. The industry added 100,000 jobs over the course of 2011.

Since Chrysler and GM emerged from bankruptcy in June of 2009, the auto industry has added back more than 170,000 jobs, the best period of job growth in more than a decade. While there’s more work to be done, it’s clear the auto industry is moving in the right direction. 

In December, we saw auto sales climb for the seventh consecutive month. The Big Three -- Ford, GM and Chrysler -- all saw sale increases for December, and the year as a whole.

In addition, because of the President’s leadership, we have put in place historic higher fuel economy standards, which will save Americans $1.7 trillion in fuel costs and reduce oil consumption by 12 billion barrels. That means families will begin saving money at the pump this year.

But there’s a lot more work to do to get the American people back to work. The President will continue to fight to restore the economic security for the communities that were hit just a few years back, to strengthen the middle class and rebuild an economy where hard work pays off and responsibility is rewarded.

Folks in Detroit and in auto communities across the country know what it takes to get the job done. They know a little something about hard work. They know what it takes to fight to rebuild their community and we’ll continue to stand right by their side every step of the way.

New Report: Investing in Innovation is Crucial to Economic Growth and Competitiveness

[Ed. Note: Watch Secretary of Commerce John Bryson unveil the report details live today from 10 am - noon]

Today, the Commerce Department and the White House sent to Congress the Administration’s plan on The Competitiveness and Innovative Capacity of the United States, fulfilling an important requirement under the America COMPETES Reauthorization Act of 2010 which President Obama signed into law one year ago this month. 

As the report emphasizes, innovation has been a key driver of U.S. prosperity and competitiveness throughout our history. Government investments in the building blocks of innovation – basic research, education, and infrastructure – have helped fuel and sustain the ingenuity of the inventors and innovators.  Innovation-based economic growth has brought us higher paying, higher quality jobs as well as improved health and quality of life. Federally-supported research has led to world-changing advancements in a variety of fields, including laying the groundwork for the integrated circuit and computer industry; the Internet; advances in chemicals, agriculture, and medical science; and GPS. Millions of workers can trace their industries and companies back to technological breakthroughs funded by the Federal government.  

In the 20^th century, our schools turned out high school and college graduates at a higher rate than anywhere else in the world, creating a highly-skilled workforce and boosting innovation.  And Federal infrastructure investments helped electrify the country, make clean water widely available, make air travel more affordable, and construct an interstate highway system. These developments helped businesses compete by opening up new markets to sell their products and services, while keeping costs low. 

Helping Small Businesses to Drive Innovation

Ed. Note: Cross-posted with the Small Business Administration Blog.

Last week, President Obama signed a bill reauthorizing the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs for another six years. This long-term reauthorization is good news for the innovative small businesses that these programs support.  SBIR and STTR invest about $2.5 billion a year in America’s most promising small research and development companies. Through SBIR and STTR, federal agencies with large R&D budgets provide competitive awards to help small businesses bring their best innovations from the drawing board to the marketplace. SBIR and STTR operate in three phases, providing support for research, development, and commercialization.

Over the years, SBIR and STTR have played a role in the growth of firms like Qualcomm, Symantec, and others. From 2002 to 2006, about 25% of R&D Magazine’s top 100 annual innovations came from companies that had received an SBIR grant at some point in their history.
 
Despite this track record, the future of SBIR and STTR had been subject to repeated short-term funding from Congress over the past ten years. This new, long-term reauthorization provides certainty and stability for the small businesses that leverage these programs to create jobs. In fact, it strengthens SBIR and STTR, proving more funding for small businesses to drive innovation, create jobs, and grow our economy. It increases the amount these programs can award to small businesses, shortens the timeline for award decisions, and improves the focus on commercializing the innovative products that will change the world.
 
SBIR and STTR are a win-win. Federal agencies are able to meet their R&D needs, while small businesses get the chance to bring their innovations into the marketplace. The reauthorization ensures that small businesses will have access to much needed investments. Money from these programs will go directly to small businesses to help them drive innovation, strengthen U.S. competitiveness, and create good jobs.  

Kentucky Entrepreneurs Share Strategy to Becoming LEED-ers in Eco Supplies

Looking back at 2011, it's clear that one of the most rewarding parts of working on the White House Business Council has been the opportunity to meet innovative, inspiring small business owners from across the country, Americans who are working hard to create jobs and opportunities in their own communities. This week we are highlighting a few of their stories.   

Zachary Riles and his wife Laila Alizadeh moved from the Pacific Northwest to her hometown of Louisville, KY with hopes of raising a family there. While looking for a new home, they quickly saw that the green housing options they had grown accustomed to in the Northwest were not available in Louisville or the surrounding areas. That realization was the genesis of  BlueGrass Green Company, a housing supplies company that offers sustainable remodeling materials for eco-conscious consumers, which launched in 2008.

Today BlueGrass Green Company sells environmentally-friendly, energy-saving products, with an inventory that ranges from zero-VOC paints and solar fans to eco-friendly countertops and natural flooring. The company is committed to only selling items that are non-toxic and made from renewable sources, and are moving towards products made exclusively from recycled materials.

An Idea that Mushroomed into a Movement

Looking back at 2011, it's clear that one of the most rewarding parts of working on the White House Business Council has been meeting innovative, inspiring small business owners from across the country, Americans who are working hard to create jobs and opportunities in their own communities. This week we are highlighting a few of their stories.

Nikhil Arora and Alejandro Velez were on their way, college seniors slated to graduate from UC Berkeley and take up jobs in investment banking and consulting, respectively. At least until their business ethics professor told them that gourmet mushrooms could be grown on 100 percent recycled coffee grounds. Arora and Velez were intrigued, they became friends, and ultimately business partners and entrepreneurs. 

After much experimentation and testing, Arora and Velez developed a system ideal for growing gourmet mushrooms out of recycled coffee grounds. Once they got the stamp of approval from a renowned chef – who proclaimed their mushrooms “delicious” – Back to the Roots was born in 2009. Arora and Velez began with fresh gourmet mushrooms, supplying about 500 pounds  per week to Whole Foods and other grocers across Northern California. But as friends and customers started asking how they could grow their own mushrooms at home, Arora and Velez shifted their business model. Back to the Roots developed its Grow-Your-Own Mushroom Garden, a kit that allows customers to sustainably grow their own gourmet mushrooms at home in just a few days. 

Open for Questions: Women’s Entrepreneurship

As President Obama has said, “our Nation's doers, makers, and entrepreneurs have proven time and again that, in America, it takes only a single good idea and the courage to pursue it to change history.”

Women-owned businesses are one of the fastest growing segments of the small business community, but women continue to face challenges, including access to capital and lack of opportunities to grow.

Ask questions and learn more about the federal government’s policies and programs that are designed to help women entrepreneurs at our upcoming “Open for Questions,” session with Christine Koronides of the National Economic Council, and the U.S. Small Business Administration’s Associate Administrator for Small Business, Ana Harvey.

• What: Open for Questions: Women’s Entrepreneurship
• Who: Christine Koronides, White House National Economic Council, and SBA’s Associate Administrator for Women’s Business Ownership, Ana Harvey
• When: Tuesday, December 20, at 3 p.m. EST
• Where: Watch live at WhiteHouse.gov/live and submit your questions via Facebook, Twitter using the hashtag #WHChat or our webform.

Hallie Schneir is Associate Director of the Office of Public Engagement

Helping Job Creators Get the Capital They Need

Today, we can do more to increase the amount of capital that flows into the hands of entrepreneurs at every stage in the growth of their companies. 

Helping these businesses grow is a top priority for the Obama Administration, as we know that small businesses create most of net new jobs that are added to the economy each year.  We have an economic imperative to make sure we support these firms through creating an environment where they have access to capital markets to help facilitate growth at every stage.

Over the past three years, we have made great progress in helping small businesses.  The President has signed into law 17 tax cuts for small businesses, from greater expensing provisions to the President’s signature call to eliminate capital gains taxes on certain investments in small businesses as well as two new small business lending funds.  SBA loans also had an all-time record year. Right now, the President continues to call on Congress to cut payroll taxes in half for nearly 6 million small businesses, providing even more incentives for them to hire and grow. 

Startups and high-growth firms – the biggest job creators – have different capital needs than other small businesses.  That’s why almost a year ago, we launched Startup America, a White House initiative to create the best possible climate for high-growth entrepreneurs across the country. Today, at the Startup America Partnership board meeting hosted at the White House, we are announcing two important initiatives that show how we are working to specifically address the needs of startup businesses.  And the President is calling on Congress to do more.

First, today we’re announcing that the Administration has taken action to create a new Early Stage Innovation Fund through SBA’s existing Small Business Investment Company (SBIC) program.  We’re making $1 billion available over the next 5 years to match private capital in funds that invest in early-stage, high growth-potential startup companies. SBA’s existing SBIC program just had a record year of helping over 1,000 businesses get $2.6 billion in capital, and created new vehicles like SBA’s first Impact Investment Fund, which recently launched in Michigan.

At the same time, the independent Startup America Partnership has mobilized commitments from more than 50 private-sector partners to deliver over $1 billion in value – from free software to free consulting and legal services – to 100,000 startups over the next three years.

And there’s more action we can take.  In September, when the President announced his American Jobs Act, he called on Congress to take specific steps to help small businesses raise the funds they need to innovate and grow.  Consistent with this call to action, the President is urging Congress to work on a bipartisan basis to develop these ideas by passing legislation related to:

• Crowdfunding:  Nonprofits have already harnessed the power of online fundraising and social media to help meet their mission.  In a similar way, we can create an appropriate regulatory framework for small businesses and startups to raise the capital they need from many small-dollar investors, while ensuring investor protections.
• Regulation A “Mini-Offerings”:  For small businesses seeking to raise less than $5 million, there is an existing exemption from certain SEC requirements.  But very few businesses are taking advantage of this “Regulation A” exemption today.  The President has called for raising that limit to up to $50 million, making it easier for small companies to raise the capital they need to grow.
• Creating an On-Ramp for Emerging Growth Companies:   For emerging growth companies, the vast majority of new jobs are typically created after they “go public.”  Yet from 1995 to 2010, listings on U.S. exchanges shrank from 8,000 to 5,000 while listings on non-U.S. exchanges grew from 23,000 to 40,000.  In March, after we held an Access to Capital conference, entrepreneurs and other private sector stakeholders formed an “IPO task force” and reported back to the Treasury Department with recommendations to help scale regulations for emerging growth companies while providing strong investor protections. Some of these ideas are being explored by Congress and the Administration right now.

While moving quickly to pass these initiatives, Congress must develop these proposals in ways that will continue to protect American investors. Over the past few months, we have begun to make real progress.  Members on both sides of the aisle have supported legislation consistent with the ideas that the President called for.  Legislation has passed the House of Representatives with overwhelming bipartisan support. And last week, these issues were highlighted at a Senate Banking Committee hearing where Chairman Tim Johnson noted “This is an issue where I believe there is real potential for bipartisan cooperation.” 

Overall, efforts like these could help improve liquidity for entrepreneurs, and help jump-start the innovative American companies of tomorrow.  At the same time, we need to ensure that as we develop these initiatives we are taking necessary measures to ensure that investors are protected – and the Administration will continue working with Congress to achieve this outcome.

The President, both of us, and leaders across the private sector understand that “one size doesn’t fit all” when it comes to helping small businesses, especially startups and high-growth firms.  Let’s make sure they can get access to the kinds of capital they need to grow and create the jobs we need now.