New York City should be the best place in America to start and run a business.
In truth, Gotham is ranked dead last in the ease of becoming an entrepreneur, according to Thumbtack, a firm that connects freelance pros with clients. The Big Apple has the highest rate of small-business closure in the country. Meanwhile, Miami is open for business, and Mayor Francis Suarez will take your call (or tweet). How is it that other cities are outcompeting and out-hustling us for business?
Running a small business is a challenge even in the best of times. In New York City, entrepreneurs face high costs, red tape and cutthroat competition. The gains can be large for those who make it. But when a shock hits, small businesses feel the blow. And 2020 was a knockout, from a global pandemic to a sudden economic freeze to riots to a steep rise in violent crime.
New York City lost one out of every eight jobs in 2020, and the city’s job market isn’t expected to bounce back until at least the end of 2024. Entrepreneurship, of course, can be a lifeline even and especially amid economic adversity, and so it’s no wonder that America has seen a surge in new business formation over the past year.
But it’s hard. Mom-and-pop shops have struggled even more than high-flying start-ups or big corporations, but we need them all. We should be giving entrepreneurs of all stripes a helping hand now, while making it easier for more New Yorkers to join their ranks and thrive.
So, Future Mayor of New York City, where are your plans for small-business competitiveness? Will you actually think like an entrepreneur, or treat City Hall like a pass-through entity for special interests?
Maybe start by doing the basics well: good services, low crime and high quality of life — and talent, talent and more talent. Imagine if city government had real customer service.
But let’s not stop there. In a new issue brief for the Manhattan Institute’s Mayoral Playbook for New York City’s Next Mayor, I outline some important steps. The next mayor can connect the dots between small businesses and the resources that already exist to support them, lending connections instead of more cash.
Indeed, New York already has a dizzying array of grants, loans and tax incentives available to businesses — all of which are impossible to navigate without serious help. By simplifying and consolidating these programs and guiding entrepreneurs through them, the next mayor can be a true small-business champion.
Microloans can also make a big difference in low-income neighborhoods, but demand often exceeds what community financial institutions can lend.
To help address this problem in the Midwest, a coalition of foundations recently created an independent entrepreneur-backed assets fund, creating a secondary market for loans, so dollars can be recycled back into local lenders and re-invested in communities. If such a fund can be created in Illinois and Indiana, why not in the city that hosts Wall Street?\
New York’s next mayor should also commit to zero barriers to starting a business. There should be no fees and no registration costs, with universal permits issued by one stop in government. Any permit or license should have a 60-day shot clock, when bureaucrats should be forced to say “yes” or “no.”
Rather than making multiple trips to different agencies at varying times, small businesses should have to only deal with a single office. Doing business in New York City should pass the smartphone test, able to be completed in a virtual city hall without leaving your screen, much as Miami’s eStart initiative is aiming to do.
City Hall should have a real Startup Advocate, someone who is a powerful voice in government on behalf of small businesses and entrepreneurs.
Seattle already appoints such an advocate in the mayor’s inner circle to be a campaigner, connector and convener for small businesses and to help the mayor meet ambitious benchmarks in boosting entrepreneurship. This person should have actually been an entrepreneur, placing an awareness of the real challenges they face at the center of the next mayoral administration.
Small businesses need New York City’s next mayor, but more important, the next mayor needs small businesses. Together, they can make Gotham the most entrepreneurial city in America.
This piece originally appeared at the New York Post
This column, the fourth in a series, was adapted from MI’s “NYC Reborn” initiative.
Photo by Drazen_/iStock