Implementing small business support is essential for economic rebound

Small businesses across the U.S. have applied for billions of dollars of aid from the government’s Paycheck Protection Program. In addition to normal political gridlock, the program is facing a dispersal problem. Northwestern University professor Benjamin Jones is available to comment on the economic implications, challenges and necessity of support for small businesses.

Benjamin Jones is the Gordon and Llura Gund Family Professor of Entrepreneurship and a professor of strategy at Kellogg School of Management at Northwestern. Jones studies sources of economic growth in advanced economies, with an emphasis innovation, entrepreneurship, and scientific progress. Jones served in 2010-2011 as the senior economist for macroeconomics for the White House Council of Economic Advisers. He can be contacted by reaching out to Molly Lynch at 773-505-9719 or molly@lynchgrouponline.com.

Quote from Professor Jones:

“Backstopping small businesses is essential to avoid waves of bankruptcies. The new federal programs will help small business owners and their workforce, and it will help the broader economy rebound relatively quickly after this pandemic.

“Implementing small business support is challenging. Unlike unemployment insurance or IRS refunds, which come directly from government agencies, here the government support flows indirectly – through a layer of banks.  Banks in turn naturally need to follow regulations, conduct due diligence and protect their own balance sheets. And they have a limited number of loan officers. These support programs will therefore operate slowly. Small businesses will have the best chances of getting funds, and getting them relatively quickly, by working through their existing banking relationships.”