Rep. Lois Capps, D-Santa Barbara, announced Tuesday that she has introduced legislation to help increase the availability of self-employment training programs for local entrepreneurs and small-business startups through local Workforce Investment Boards.
Workforce Investment Boards are currently authorized to provide entrepreneurial training services, yet very few do so because self-employment outcomes are hard to document for current Department of Labor regulations, which are geared more toward traditional job creation and placement. To address this problem, the Entrepreneurial Training Improvement Act of 2012 (House Resolution 5085) would direct the U.S. Department of Labor to establish alternative guidelines specifically for measuring the progress of entrepreneurial training programs, adjusting federal regulations to better reflect the realities of self-employment and make it easier for WIBs to offer these programs.
“As we work to help small businesses grow and create jobs, we can’t overlook the importance of the smallest of businesses — our innovative entrepreneurs,” Capps said. “And the Central Coast is home to some of the nation’s most creative of them. This legislation will build on their success by helping ensure entrepreneurs have access to the resources they need to start their own businesses, create jobs and help our economy grow.”
“While some WIBs have been successful in structuring programs and services to support the training needs of entrepreneurs, a greater number have felt constrained by the existing performance measures they must meet under the Workforce Investment Act, and have stayed away from entrepreneurship training as a service strategy,” said Barbara Halsey, executive director of the California Workforce Association. “I congratulate Congresswoman Capps for championing this important work.”
“For the numerous intelligent, skilled and hardworking individuals who continue struggling to find work in this economy, self-employment offers a great opportunity. Unfortunately, current Workforce Investment Act rules do not recognize self-employment as a ‘positive’ performance measure, and limit organizations like the WIB from helping these individuals succeed,” said Raymond McDonald, executive director of the Santa Barbara County Workforce Investment Board. “The Entrepreneurial Training Improvement Act will correct a grave injustice in the workforce system, spurring creativity and fueling the local economy. I strongly support passage of this bill.”
“In addition to benefiting local entrepreneurs, the legislation will aid the Central Coast in reshaping its competitive position in a changing economy,” said Nick Schultz, director of the Workforce Investment Board of San Luis Obispo County. “It will unquestionably help us more effectively bridge the gap between research and commercialization by increasing entrepreneurs’ access to mentorship, support and training that prepares them to take their ideas to market.”
The need for the legislation was first brought to Capps’ attention by David Ryal, program director of Mission Community Services Corporation’s Women’s Business Center in San Luis Obispo, Kern and Monterey counties. Working to increase self-employment training opportunities for local entrepreneurs, he grew frustrated by the rules discouraging WIBs from offering the training services and brought it to Capps’ attention.
“As a director of an economic development nonprofit that runs a small-business center, I have seen many displaced workers and returning veterans actively seeking alternative employment, yet struggle to get support for entrepreneurial training through a Career One-Stop Center,” Ryal said. “Looking for a solution, I brought the issue to Congresswoman Capps, who immediately took up the cause. The Entrepreneurial Training Improvement Act is the product of these efforts and has my full support.”
The self-employed represent a significant majority of American small businesses. Of the estimated 27.5 million American small businesses, 21.4 million are owned and operated by one person. One of the bright spots during this recession has been the substantial increase in the number of Americans starting their own businesses. According to the Kauffman Index of Entrepreneurial Activity, the number of new business startups has increased significantly since 2007. Last year alone, American adults created an average of 543,000 new businesses — and jobs — every month, among the highest levels seen in the past 16 years.
“In this time of high unemployment, we need to encourage job creation,” says Claudia Viek, CEO of the California Association for Micro Enterprise Opportunity. “We need to unleash the entrepreneurial potential of the unemployed who could become self-employed. This bill enables us to turn the long-term unemployed into small-business owners by eliminating systemic obstacles in the workforce system.”
The bill is supported by the California Association for Micro Enterprise Opportunity, the California Workforce Association and local Workforce Investment Boards.
— Ashley Schapitl is press secretary for Rep. Lois Capps, D-Santa Barbara.