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Statement of The Hon. Andy Kim on The Importance of Accurate Census Data to Small Business Formation and Growth

Washington, June 20, 2019

One of the most important goals of this Subcommittee is to assure that small businesses are equipped with the tools they need to grow, create new jobs, and generate wealth in their communities. No matter where a business decides to set up shop, whether it’s in the middle of a large metropolis, or on main street in a rural town, every business needs a plan. From determining a location, to finding workers with the proper skills, accurate information about members of the community is vital for entrepreneurs and small business owners.

Luckily, our founding fathers foresaw the need for an accurate snapshot of the American people. So, every ten years since our country’s inception, the constitution mandates that we take a proper count of all current residents of the United States. The federal government uses this information to determine where to allocate billions of dollars in resources through federal and state programs – where to build infrastructure, provide public health services, or allocate resources to make our communities better prepared for disasters.

In that vein, the SBA uses this information to determine where they might want to invest more resources based on demographic changes and population shifts. An accurate Census is necessary to ensure we are allocating resources efficiently since these funds have an impact on the economic development in our towns and cities.

The use of census information is not just important for the government -- it extends into the private sector as well. The Census is an invaluable tool for those looking to start or grow a business by providing the most affordable, accessible source of information about the demographics of our country and the growth potential of the American economy.

Small firms have come to rely on this data to make important decisions that can make or break their bottom line. Entrepreneurs and small firms use this information to better assess customer demand, identify new markets, and where to make an investment.

As we all know, starting or running a business is not an easy thing to do. But one of the biggest reasons small businesses fail, is because they often do not have access to the affordable, reliable information that their larger competitors have. You wouldn’t want to start a daycare in a town where the median age is 63, but you might want to open a second restaurant if you know that more people are moving to your town or a new highway is being built.

To understand market trends, a business owner must be able to freely access accurate and robust data. The census provides data that is integral to market research and business plan development. Through not only the decennial census, but a variety of other surveys conducted monthly, quarterly, and annually, the data provided by the Census Bureau helps businesses understand where to start, how to market, and who to hire.

A new tool available through the census compiles all the data from these different surveys directly for the purpose of informing business owners. The Census Business Builder, among other tools on the Census website, helps companies easily access this information.

Through it, entrepreneurs, SBDC Counselors, and local Chambers of Commerce can access information to better understand community needs. They can measure the potential for new markets, where to target advertising dollars, and assess labor trends in the area to determine the workforce available for their company to thrive.

Many of the most important decisions of a company can rely directly on the data collected through the census. So, for the economy to continue to grow, and for wealth to continue to be created, we must ensure that the count is as accurate as possible. We must ensure that the data businesses rely on to make evidence-based decisions provides the best snapshot of our communities.  

Any mistakes in the count next year could create a ripple effect throughout the economy. Small firms and entrepreneurs rely on accurate information from the data to make material decisions that will help create jobs and spur economic growth.

That is why today’s hearing is so timely and important. We can all agree that an accurate count is incredibly important for our nation’s small businesses. I look forward to working with my colleagues on both sides of the aisle to ensure that next year’s census provides our businesses with the most accurate and robust data yet.

 

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