The corporate giants and big banks of Wall Street should establish partnerships with universities to create small businesses, which will help create more jobs and decrease the significantly high unemployment rate of the United States.
Small businesses in America are on the ropes. Large banks such as Bank of America, JP Morgan Chase, etc., have significantly brought them down by declining to extend loans and credit. The New Rules Project notes that the country’s 20 biggest banks “devote only 18% of their commercial loan portfolios to small businesses.”
The decline of small businesses will minimize competition in the U.S. marketplace and will fuel excessive unemployment. Despite the decline of small businesses, the capacities of big banks have largely expanded. According to 11 Facts You Need to Know About The Nation’s Biggest Banks, “Due to the failure of small competitors and mergers facilitated during the 2008 crisis, the nation’s biggest banks – including Bank of America, JP Morgan Chase, and Wells Fargo – are now bigger than they were pre-recession. Pre-crisis, the four biggest banks held 32% of total deposits; now they hold nearly 40%.” Yet the federal government bailed out these giant corporations instead of focusing on helping small businesses.
The solution to the number of declining small businesses is to establish a partnership between big banks and universities. Since universities generate large profits from small businesses around their campuses, big banks and universities can work together to establish a program that can help sustain existing small businesses and create new ones. In return, corporate greed will be limited and more jobs will be created, which will strengthen the economy.
Big banks and universities should work together in partnership to empower the small businesses around university campuses. There are a number of advantages of creating these programs for small businesses, including accessible loan funds and consultation from professional experts. The program will also result in an increase in consulting services for entrepreneurs.
Colleges such as the City College of New York (CCNY) have made contracts with corporations such as the Metropolitan Food Company to establish a food restaurant business on campus. NY based Metropolitan Food Service, Inc. has been providing creative Food Service Management solutions for colleges and universities in the greater New York City area.” This ensures conveniently accessible food for students on campus.
However, since the Metropolitan Food Company represents a monopoly, it is generating large amounts of profits and it is also limiting competition. If CCNY partnered with a big bank such as JP Morgan Chase, they could both use their wealth to establish more small businesses around CCNY’s campus. JP Morgan Chase has partnered with Syracuse University to increase education in the area of financial services information technology. Big banks have the capability of going further by establishing small businesses along with the university. Such partnerships can generate more profit and increase jobs at the same time.
Universities and big banks can work together to establish programs that can help create small businesses and jobs. The federal government can facilitate this process by creating a forum for university and small business partnerships.