It’s time to get serious about creating jobs in Los Angeles. Since 2007, more than 400,000 Angelenos have been laid off, 13 percent of the work force has been forced into unemployment and yet we still haven’t come up with a successful comprehensive regional plan to pull ourselves out of this nightmarish recession.
This is completely unacceptable.
We need new ideas and solutions to create jobs. And the only place left that we haven’t searched for these new approaches – as I mentioned in my editorial in the Feb. 14 issue (“Paying to Jump Start Los Angeles”) – is from our main source of economic development: the startup entrepreneurs and venture capitalists who are largely responsible for creating 75 percent of all jobs in Los Angeles. So far these innovators haven’t been invited to our ongoing conversation about job creation, and this could be costing our region dearly.
When policymakers ask the business community for their recommendations on how to create additional jobs in Los Angeles, for example, they logically seek out counsel from representatives of big business – or business associations that get most of their funding from large corporations. Unfortunately, most of these same big businesses have lost more jobs than they have created over the last 30 years, according to studies produced by nonpartisan think tank the Kauffman Foundation. Consequently, many of the proposals the business community submits, while mostly good, have done little to spur substantial job creation (i.e., lowering tax rates, easing building permit requirements, offering tax credits, launching buy-local marketing campaigns, creating public works projects, etc.) because they are designed to primarily benefit large corporations that statistically don’t create most jobs here.
Disappointed
But when policymakers implement these recommendations hoping they will dramatically reduce unemployment, they become disappointed when new jobs don’t materialize and, as a result, may assume they don’t have anywhere or anyone else to turn to for assistance.
They do.
Instead of almost exclusively relying on advice from the traditional big-business community, Mayor Antonio Villaraigosa, City Council President Eric Garcetti, the Los Angeles County Board of Supervisors and other elected officials also should make an effort to hear directly from the startup entrepreneurs and venture capitalists responsible for creating most of the jobs here. When they do, what they will find is a refreshing, insightful, talented group of innovators who historically have felt shut out of the debate but who are eager to contribute their ideas and experiences for the benefit of Los Angeles. Many of their unique approaches for job creation would be low cost and high impact, and would probably include:
• Establishing a commission on job creation comprised heavily of high-growth startup entrepreneurs and venture capitalists to propose new job creation strategies.
• Forgiving the mortgage, credit card or loan debt of any Angeleno bringing substantial jobs to Los Angeles through an innovative public-private partnership.
• Launching voluntary business incubators for the unemployed to teach them how to start their own businesses instead of having them solely rely on established employers to create jobs for them.
• Enabling startup companies to participate side by side in a local joint-powers authority purchasing consortium with municipal entities to reduce materials acquisition and energy costs, and various insurances.
• Guaranteeing a minimum percentage of annual government contracts to demonstrated job-producing startup companies.
• Creating a centralized online social network for L.A. businesses to barter goods and services, connect with private- and public-sector contracts, and explore opportunities.
• Dramatically discounting office space and parking fees for new companies with job-creating potential.
• Recruiting a domestic microfinance bank to administer small-business microloans to the unemployed and underemployed who want to start their own job-generating companies but who don’t qualify for traditional Small Business Administration loans because of their circumstances.
These ideas are just a small sample of a bolder, more innovative approach to job creation that Los Angeles could be adopting with the help of our mostly untapped entrepreneurial and venture capital industries. Fortunately, some inside and outside of government are beginning to recognize this need to include these innovators in designing our municipal jobs strategies, and we are better off because of it. The Southern California Association of Governments and I are starting to collect invaluable information from these innovative stakeholders who are providing new, robust, outside-of-the-box ideas for policymakers so that they can have more tools to aggressively reduce unemployment.
The good news is that Los Angeles can unquestionably get people working again, but we can only do so by enlisting those who know how to do it best – our innovative, job-creating startup entrepreneurs and venture capitalists. Once we do, we’ll not only begin to replace the old jobs that we lost, but we’ll actually start to create some new ones, too.
Rob Carpenter is a startup entrepreneur, writer and Los Angeles Board of Transportation commissioner. He previously held positions in the White House Office of Political Affairs and at a Washington, D.C. think tank.
