A Good Idea Until You Think About It

For many years I’ve been underscoring the fact that small businesses in the US (and Canada) are the primary generators of net, new jobs in the economy. Larger organizations tend to use automation and lean practices to reduce employment, and hire people as replacements—they tend not to create new jobs.

Today I’ve learned that over the past decade, start-ups have specifically been the largest net, new job creators. Yet, in the US. that is exactly the group that will be hurt most if the proposed new tax reductions take effect. These are the firms that have not been able to secure large amounts of loans from cautious banks nor are they yet generating huge profits.

From a consulting standpoint it’s a lesson in the need to examine adverse consequences of any decision, and to prevent them, mitigate them, of find another alternative entirely. Helping large corporation which generate no net, new jobs and hurting start-ups that do is not a way to stimulate the economy.

4 thoughts on “A Good Idea Until You Think About It

  1. I’m not condemning the entire tax package, I’m merely pointing out that you need to consider all factors and make adjustments. Those entrepreneurs in the start-ups are providing the new jobs for those people you quote. If they can’t do that because of a misapplied tax policy, you’re going to have more unemployment. You always have to ask IF/THEN. IF we do this, THEN what are the risks? I’m pointing out one of them unless they adjust the provisions.

  2. I agree 100% with your idea to consider all options and the If/Then analysis. I just didn’t see a specific condemnation of the plan – which actually helps entrepreneurs – and got nervous that I would have to disagree with you for the first time in nearly 3 years.

    P.S. Tell the guys I said thanks for fixing the comment apparatus.

  3. My new technical support team is far, far better than I had with the last guy.

    My point is that there are possible flaws in the plan that aren’t apparent unless you ask yourself questions such as, “Where are new jobs coming from these days, and how do we support that?”

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