Starbucks is hoping when patrons walk into one of their stores beginning Nov. 1, that along with their morning jolt of caffeine, they will also want to give a jolt to small businesses.
The company’s Create Jobs For USA initiative is an attempt to jump-start hiring where many people say it matters most — on the small business level.
“Small businesses are the backbone of America, employing more than half of all private sector workers, but this critical jobs engine has stalled,” Starbucks CEO Howard Schultz declared when he announced the initiative in early October. The key to job creation, he says, “is to thaw the channels of credit so that community businesses can start hiring again.”
Schultz and a team of Starbucks executives came up with the idea of partnering with Opportunity Finance Network, a national network of community development financial institutions, or CDFIs, that has experience putting money into the hands of businesses in underserved communities.
Main Street has been hit particularly hard in the recession that began in 2008. As banks dealt with mortgages gone wrong and decreases in assets, lending for small businesses dried up. Without operating capital, small businesses had to lay off employees and close altogether.
“We felt that this was an emergency,” said Adam Brotman, senior VP and general manager, digital ventures at Starbucks, among the Starbucks executives who cooked up the idea while sitting around Schultz’s dining room table one evening in late August. “Not only are a significant number of people out of work, but many are underemployed, as well.”