Jon Husted Questions SBA Administrator Kelly Loeffler About Changing Manufacturing Loans Demand

Forbes Breaking News

During Wednesday’s Senate Small Businesses and Entrepreneurship Committee hearing, Sen. Jon Husted (R-OH) questioned SBA Administrator Kelly Loeffler about manufacturing loans.

Transcript

00:02The Chair now recognizes Senator Houston for five minutes.

00:06Thank you, Mr. Chairman.

00:09I would like to thank you, Administrator Loeffler, for being here today.

00:13Thank you very much.

00:14I know that you have been traveling the country on the America Manufacturing Initiative and

00:22Made in America.

00:23I always say, as a representative of Ohio, that you can't do Made in America without

00:28Made in Ohio, although my friends from Indiana would feel the same way, right?

00:32We're such a big part of the supply chain for our economic and national security because

00:38you have to make it here.

00:39You have to be able to make it here in times of crisis if we're going to secure our national

00:45security and provide for our economic security.

00:49I will also mention that as I've been talking to Ohio manufacturers, particularly small businesses,

00:56they raise this in the context of China and tariffs, that they have no recourse if their

01:02items are, if their patents are violated, if their products are stolen.

01:06And that's something that I know that you and led by President Trump care a lot about.

01:11And so I would encourage you to continue to be a strong voice for that.

01:18But I will want to touch on the 7A loan program.

01:23As I have learned, as I look at manufacturing, I've learned that a lot of small manufacturers

01:30over the course of the Biden administration saw that fewer loans were being made in that

01:36sector.

01:37There were, saw a drop of nearly 2% in the number of loans that were given to manufacturers.

01:45Manufacturing, manufacturers in my experience, need the loans almost as much as anybody because

01:50of the capital costs involved in manufacturing, particularly with the new technologies

01:55and the additive manufacturing space.

01:58Super important for them to have, to be able to finance the new technologies that will add to manufacturing.

02:06Just your thoughts on, on that program.

02:11And then anything that you might want to share that you've learned from your tour in the space

02:16that I've talked about as you've been traveling the country.

02:19Absolutely.

02:20Thank you, Senator.

02:21And I look forward to visiting manufacturers in Ohio.

02:24We want you to come see us.

02:25Great.

02:26Of course.

02:27Well, first of all, the data that we have on our manufacturing loans, both for 7A and for 504,

02:36demonstrate that there is great demand and growth in manufacturing loans.

02:41And we've seen a 74% increase in the 504, I'm sorry, the 7A loan program relative to President Biden's first 100 days.

02:50We've seen a 38% increase overall in the 504 and 7A loans combined.

02:56And where we've had conversations with both lenders and our manufacturers is that the loan limits make the loans less attractive.

03:06Like the limit of $5 million has represented a somewhat artificially low cap now about 15 years after the last increase was made.

03:17So providing the $10 million loan cap will help us attract more manufacturing loans to provide more capital.

03:25I've talked to manufacturers that have already identified the equipment and the workforce that they're going to hire

03:31once they can expand the access to capital and as well have the access, have the certainty of the tax bill that's in Congress right now.

03:40So we feel that manufacturing is spring-loaded in America.

03:44We see manufacturers extremely bullish on the opportunities.

03:48They've heard from, as I've gone around this country, they've heard from domestic contacts and international contacts

03:56that more people want made in America.

03:58And so we see tremendous need for workforce as well.

04:01And that's been an effort that, following the conversations we've had with manufacturers,

04:06is that we've ramped up our focus on a skilled workforce.

04:09I've visited several technical schools, career academies, and seen the great work going on there,

04:16the type of training, whether it's CNC machines or welding or HVAC and the like.

04:26The tremendous skilled workforce that we have coming in the pipeline is exciting.

04:31It's not just a focus on STEM, but it's on building things.

04:34It's making manufacturing a hot industry, as my friend Ann calls it, a new color boom,

04:42which means we're integrating technology with manufacturing.

04:45And we see tremendous demand for those jobs.

04:48And it's a great path and really addresses the challenge we've had in the last 30, 40 years,

04:55where our working communities have been just hollowed out and decimated due to the loss of those jobs.

05:01We're going to rebuild those in this country, and I think the SBA is going to be a part of that.

05:05I would just, in closing, share with you on the workforce side of things that we are seeing a resurgence in this country

05:14of more high school students graduating career-ready through the tech schools, through career tech education in their classrooms,

05:25and through apprenticeships, a growing desire for more students to see that as a more cost-effective pathway into the workforce.

05:32But I also caution that in a lot of states we have a demographic problem,

05:37that we literally have more people between the ages of 55 and 64 than we do between 15 and 24,

05:43which means that we're going to have to be great at this if we're going to supply that high-tech workforce

05:48and manufacturing workforce for the future.

05:51Absolutely.

05:52And we'll be focused on training and retraining as well, because we know that there's a great skilled workforce out there

05:59that is ready to get back to work, so we'll be focused on that.

06:02Thank you, Senator.

06:03Thank you for being here today.

Category

Transcript

Recommended