I recently learned that my favorite local coffee company, Virginia Commonwealth Roasters, permanently closed its doors after operating in south Stafford and Fredericksburg for over seven years. On its website and Facebook page, it said that the lasting impacts of the pandemic, the rising cost of green coffee beans, and overall inflation made it impossible to continue production and offer a fair price to customers.
You could often find the company at a local farmers market, craft beer festival, or at the Fredericksburg Expo Center around the holidays selling its coffee and gourmet chocolate bars. When I learned it offered monthly subscriptions, I jumped at the chance to subscribe. I loved its coffee and will miss it every morning. I will also miss the small rubber duckies that were placed in the bag with each delivery. Although, perhaps, my pets will miss those more than me.
Small businesses like Virginia Commonwealth Roasters make up most of our economy. According to the U.S. Small Business Administration, there are 783,977 small businesses in the commonwealth representing approximately 99% of all Virginia businesses. Our small businesses are also the majority of our job creators, providing employment for over 1.6 million workers, or about 47% of all Virginia employees.
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In our region, small businesses employ between 50% and 75% of our workers. So, when a small business like Virginia Commonwealth Roasters folds, it makes me wonder about the overall economic health of our region and whether we are doing as much as we can to support the formation and longevity of our small businesses both at home, through our local economic development authorities, and in Richmond through our statewide policies.
While it does appear that our local economic development authorities are busy finding new ways to support area businesses, there is at least some evidence to suggest that policymakers in Richmond are not pulling their weight. Many small businesses are still waiting for pandemic relief funds through the Rebuild Virginia grant program, with some of those wait times being more than a year.
Moreover, the funds made available to small businesses do not appear to be adequate to meet the need for relief. Before the General Assembly increased funding for the Rebuild Virginia grant program in August 2021, the program’s funding had run out with over 9,000 applications left in the queue. Admittedly, the commonwealth has distributed over $349 million to over 6,900 small businesses as of May 1, 2022, but one must wonder how many more need help.
The General Assembly’s response thus far has not been inspiring. One of the few small business bills last session that was identified as a “Bill We’re Watching” by the Virginia Chamber of Commerce was left in the House Commerce and Energy Committee. That bill, sponsored by Del. Kathleen Murphy, would have established the Retail Small Business Grant Program and Fund to support existing small businesses and foster more business development.
Meanwhile, local business owners who I have talked to have shared concerns about supply chain disruptions, rising operational costs due to inflation, and the lack of workforce development and skills training. They are having trouble finding workers who can fill high-demand jobs in information technology and skilled trades. Our public schools are not providing students with the skills employers need.
The physical infrastructure that small businesses depend upon, including the roads and public transportation that we use to get to work, also need significant improvements. In 2017, INRIX, a traffic data firm, estimated that Fredericksburg area motorists would realize $2.3 billion in wasted time, lost fuel, and additional carbon emissions by simply sitting in traffic. Traffic seems to have only worsened since that study was conducted.
Furthermore, small businesses depend upon so-called “soft” infrastructure like child care. We have a tremendous need for early childhood education in the commonwealth. Aside from the developmental benefits of early childhood education for the children, greater access to affordable child care allows parents to get back to work sooner, thereby expanding the labor market. According to the Brookings Institute, the economy currently loses more than $50 billion per year in revenue, wages, and productivity due to persistent child care needs.
Although recent events have created a new sense of urgency, it has long been clear that we must do more to support our small businesses. Lawmakers must ensure that small businesses have a fighting chance.
Benjamin M. Litchfield is former chair of the Stafford County Democratic Committee and plans to be a candidate for the Virginia Senate in 2023.