II 

117TH CONGRESS 

1ST SESSION S. 329 

To require the Secretary of Commerce to conduct an assessment and analysis 

relating to the decline in the business formation rate in the United States. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 12, 2021 

Ms. KLOBUCHAR (for herself, Mr. SCOTT of South Carolina, Ms. SINEMA, and 

Mr. YOUNG) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation 

A BILL 

To require the Secretary of Commerce to conduct an assessment and analysis relating to the decline in the business 

formation rate in the United States. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Enhancing Entrepre5 neurship for the 21st Century Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 

8 (1) Recent research has demonstrated that— 


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1 (A) new businesses (commonly referred to 

2 as ‘‘startups’’)— 

3 (i) are disproportionately responsible 

4 for the innovations that drive economic 

5 growth; and 

6 (ii) account for virtually all net new 

7 job creation; 

8 (B) the rate of formation of United States 

9 businesses has fallen significantly in recent 

10 years; and 

11 (C) as determined by widely cited research, 

12 the decline in the rate described in subpara13 graph (B) is occurring in all 50 States, in all 

14 but a handful of 360 metro areas examined, 

15 and across a broad range of industry sectors. 

16 (2) Before policymakers can identify ways in 

17 which the decline in the rate described in paragraph 

18 (1)(B) may be counteracted, the underlying causes 

19 of the decline must be identified. 

20 (3) Economists have identified several factors 

21 that may explain the decline in the rate described in 

22 paragraph (1)(B), including— 

23 (A) demographic changes caused by an 

24 aging workforce and slowing population growth; 


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1 (B) increased industry concentration that 

2 may make it more difficult for new market en3 trants to compete with established companies; 

4 (C) increased risk-aversion following the fi5 nancial crisis and recession that occurred in 

6 2008 and 2009 and deterioration of household 

7 balance sheets; 

8 (D) difficulties relating to access to cap9 ital, particularly difficulties encountered by un10 derserved populations, women, and members of 

11 minority groups; 

12 (E) the concentration of venture capital in 

13 only a few cities; 

14 (F) record levels of student debt; and 

15 (G) inefficiencies or other difficulties relat16 ing to the commercialization of federally funded 

17 research and innovation. 

18 SEC. 3. DEFINITIONS. 

19 In this Act: 

20 (1) APPROPRIATE COMMITTEES OF CON21 GRESS.—The term ‘‘appropriate committees of Con22 gress’’ means— 

23 (A) the Committee on Commerce, Science, 

24 and Transportation of the Senate; and 


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1 (B) the Committee on Energy and Com2 merce of the House of Representatives. 

3 (2) ENTREPRENEUR.—The term ‘‘entre4 preneur’’ means an individual who founded, or is a 

5 member of a group that founded, a United States 

6 business. 

7 (3) SECRETARY.—The term ‘‘Secretary’’ means 

8 the Secretary of Commerce. 

9 (4) UNITED STATES BUSINESS.—The term 

10 ‘‘United States business’’ means a corporation, part11 nership, association, joint-stock company, business 

12 trust, unincorporated organization, or sole propri13 etorship that— 

14 (A) has its principal place of business in 

15 the United States; or 

16 (B) is organized under the laws of a State 

17 of the United States or a territory, possession, 

18 or commonwealth of the United States. 

19 SEC. 4. ASSESSMENT AND ANALYSIS. 

20 (a) ASSESSMENT AND ANALYSIS REQUIRED.—Not 

21 later than 2 years after the date of enactment of this Act, 

22 the Secretary, in consultation with the Director of the Bu23 reau of the Census and the Director of the Bureau of Eco24 nomic Analysis of the Department of Commerce, shall con25 duct an assessment and analysis regarding the reasons for 


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1 the state of the formation of new United States businesses 

2 during a period— 

3 (1) that the Secretary determines appropriate 

4 based on the data described in subsection (b)(1)(A); 

5 and 

6 (2) ending on the date on which the assessment 

7 and analysis is conducted. 

8 (b) CONSIDERATIONS AND CONSULTATION.— 

9 (1) IN GENERAL.—In conducting the assess10 ment and analysis required under subsection (a), the 

11 Secretary shall— 

12 (A) notwithstanding any other provision of 

13 Federal law, and subject to paragraph (2), re14 view data collected and maintained by— 

15 (i) the Bureau of the Census; 

16 (ii) the Bureau of Economic Analysis; 

17 (iii) the Bureau of Labor Statistics; 

18 (iv) the Small Business Administra19 tion; 

20 (v) the Department of the Treasury; 

21 (vi) the Board of Governors of the 

22 Federal Reserve System; and 

23 (vii) any other Federal or State agen24 cy, or public or private sector organization, 

25 that the Secretary determines appropriate; 


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1 (B) with respect to the formation of new 

2 United States businesses, consider the impact 

3 of— 

4 (i) demographic changes caused by an 

5 aging workforce and slowing population 

6 growth; 

7 (ii) increased industry concentration 

8 and whether such concentration may make 

9 it more difficult for new market entrants 

10 to compete with established companies; 

11 (iii) increased risk-aversion following 

12 the financial crisis and recession that oc13 curred in 2008 and 2009 and deterioration 

14 of household balance sheets; 

15 (iv) difficulties relating to access to 

16 capital, particularly difficulties encountered 

17 by underserved populations, women, and 

18 members of minority groups; 

19 (v) the concentration of venture cap20 ital in only a few cities; 

21 (vi) record levels of student debt; 

22 (vii) inefficiencies or other difficulties 

23 relating to the commercialization of feder24 ally funded research and innovation; 


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1 (viii) the use of federally funded re2 search and innovation in the commercial 

3 market; 

4 (ix) regulatory burden, overlap, com5 plexity, and uncertainty at the Federal and 

6 State levels; 

7 (x) aspects of the Internal Revenue 

8 Code of 1986 that penalize, obstruct, or 

9 otherwise disadvantage new businesses, or 

10 investors in new businesses, relative to in11 cumbent businesses, or investors in incum12 bent businesses, respectively; 

13 (xi) foreign-born entrepreneurs and 

14 the impact of those entrepreneurs on job 

15 creation; and 

16 (xii) any other factor that the Sec17 retary determines appropriate; and 

18 (C) consult with— 

19 (i) the heads of any agencies and of20 fices of the Federal Government that the 

21 Secretary determines appropriate, includ22 ing— 

23 (I) the Secretary of the Treasury; 

24 (II) the Secretary of Labor; 


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1 (III) the Administrator of the 

2 Small Business Administration; 

3 (IV) the Chief Counsel of the Of4 fice of Advocacy of the Small Busi5 ness Administration; and 

6 (V) the Board of Governors of 

7 the Federal Reserve System; 

8 (ii) entrepreneurs, including entre9 preneurs who are women or members of 

10 minority groups, especially entrepreneurs 

11 who founded United States businesses that 

12 experienced rapid growth; and 

13 (iii) representatives from consumer, 

14 community, and entrepreneurship advocacy 

15 organizations. 

16 (2) CONFIDENTIALITY.—With respect to data 

17 reviewed by the Secretary under paragraph (1)(A), 

18 the Secretary shall ensure that the data is subject 

19 to the same confidentiality requirements and protec20 tions as the confidentiality requirements and protec21 tions of the agency or entity, as applicable, providing 

22 the data. 

23 (c) REPORT.—The Secretary shall submit to the ap24 propriate committees of Congress a report regarding the 


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1 findings of the Secretary with respect to the assessment 

2 and analysis conducted under subsection (a). 

Æ 


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