Wyden, Carper, Casey Self-Employment Assistance Bill Included in Payroll Tax Agreement

Self-Employment Assistance lets Entrepreneurs Maintain Unemployment Insurance While They Build Their Own Business

Washington, D.C. – In a victory for would-be entrepreneurs throughout the country, legislation to give unemployed Americans an opportunity to use their skills to build their own small businesses was included in the agreement on the payroll tax extension. Introduced by U.S. Senators Ron Wyden (D-Ore.), Tom Carper (D-Del.) and Bob Casey (D-Penn.), the Startup Technical Assistance for Reemployment Training and Unemployment Prevention (STARTUP) Act alters the rules governing the unemployment insurance program to allow recipients starting their own small businesses to collect their unemployment without the added burden of searching for other full time work.

The deal allows for a one-year program totaling $35 million which is both authorized and appropriated, guaranteeing that the funding will be used to foster small business growth. Several states like Oregon and Delaware already offer similar programs to UI recipients looking to startup their own small businesses and those programs have a track record of success. The provision in the payroll tax and unemployment insurance extension agreement would expand that opportunity to promising entrepreneurs nationwide.

“Starting a small business is a full time job,” Wyden said. “It takes time and sweat equity to make a business successful which the current unemployment rules don’t provide. With the unemployment rate remaining high, there is a great deal of talent sitting on the sidelines vying for too few jobs. Self-employment assistance allows the most industrious of those people to maintain their unemployment insurance benefits while building businesses that could take even more people off of the UI rolls.”

“We know that small businesses are a powerful part of fostering economic growth in America,” Carper said. “Self-Employment Assistance is a win-win opportunity that helps our economy and our unemployed workers by providing the unemployed with access to the resources they need to launch their own business. As Governor, I signed legislation in 1995 authorizing Delaware’s participation in the Self-Employment Assistance program into law—making the First State one of just eight states to offer a this groundbreaking program to unemployed workers. Now that our proposal for Self-Employment Assistance has been included in the extension of Unemployment Insurance benefits, more states will have the authority and the resources to participate in this critically important re-employment program. And, by offering more workers access to this underutilized and innovative alternative, we will not only ensure that more Americans will find jobs but we will also help generate further economic growth by fostering the next generation of startups that make our communities and economy stronger.”

“Getting this bill in the conference committee’s final report means that Pennsylvanians looking for work will have an easier time starting their own business,” Senator Casey said. “In order to keep our economy moving forward we need to provide incentives for entrepreneurs to take the kinds of risk that will allow them to create jobs, and this bill will do just that.”

Current unemployment insurance rules require recipients to be actively searching for and willing to accept suitable work. Self-employment assistance allows a small number of those same recipients who want to start their own businesses to maintain their benefits while they build their companies. Allowing entrepreneurs the ability to focus on building their businesses instead of looking for other work just to keep their UI benefits increases their likelihood of success. Would-be entrepreneurs must have a valid business plan to receive SEA but will also be eligible for job training opportunities to further increase that likelihood of success.

The provision will also provide technical assistance and model language from the Department of Labor as well as financial assistance to aid in the creation and expansion of state SEA programs.

The bill still needs to be passed by the full Senate and House of Representatives.