Rethinking economic development in Illinois
The Great Recession caused many small businesses to struggle and face remarkable uncertainty.
While politicians talked about small businesses being the engine driving our economy during this difficult time, the small business community was often overlooked by policymakers. The failure of many politicians to support small businesses crystallized the need for small business owners and advocates to come together and speak with a unified voice. Hence, the Small Business Advocacy Council was launched.
The SBAC has engaged policymakers and fought to pass policies that support the small business community for over a decade. There have been many important wins and some losses along the way. However, one consistent and often elusive objective for the organization has been leveling the playing field for small businesses.
Illinois politicians often seem too focused on providing tax breaks to large companies while ignoring the small businesses that drive our economy and support local communities. Incentivizing big businesses to relocate or remain in our state can be a valuable way to promote economic development.
It is difficult to understand, however, why some policymakers seem so reluctant to provide support to small businesses as they continue to push lush incentives for large corporations.
An example is policymakers' focus on establishing programs that primarily provide tax breaks to large companies while failing to renew the Illinois Small Business Job Creation Tax Credit when it expired in 2016. Despite engagement in Springfield, providing committee testimony and the strong support of the small business community, we were unable to convince legislators to reinstate the program. It provided a $2,500 tax credit to businesses under 50 employees that created a new job within the fiscal limits of the program. This tax credit should have been reinstated.
This is not an issue of big versus small businesses because the success of both is crucial to a strong and healthy economy. However, there should be a balance struck when our state is providing economic tax incentives.
The concept that bringing large companies into Illinois also helps small businesses only works if small businesses have the capacity and resources to take advantage of new opportunities.
Many small businesses are still fighting to recover from the pandemic. They have struggled to hire qualified employees. They now face rising inflation and interest rates.
Health insurance premiums seem to be increasing, along with the other costs associated with owning a small business. Strategies to grow our state's economy must include providing crucial support for small and local businesses.
We invite policymakers to engage with the small business community for a discussion about economic development. We encourage politicians to work with us to develop a strategy for leveling the playing field for small businesses.
Bigger companies should engage as well because the success of small businesses is crucial to fostering a strong economy. Rethinking economic development to broadly support the business community will strengthen local communities and our overall economy. Let's engage in this important discussion because we are all in this together.
• Elliot Richardson is co-founder and president of the Small Business Advocacy Council.