FTC Non-Compete Ban Final Rule Will Help America’s Small Businesses Grow

For Immediate Release: 
Tuesday, April 23, 2024

Statement by John Arensmeyer, Founder & CEO of Small Business Majority, on the harm caused to small businesses by non-compete agreements.

Washington, D.C. — The Federal Trade Commission’s (FTC) final rule banning non-compete agreements is a victory for the U.S. economy because it will help fuel small business growth. In fact, Small Business Majority’s research revealed that more than 33 percent of small business owners were prevented from hiring an employee due to a non-compete agreement, and nearly 50 percent said that they have been subject to a non-compete agreement that prevented them from starting or growing a business of their own.  

Small Business Majority has long opposed non-compete agreements because they restrict individuals from pursuing opportunities for upward mobility and greater earning power. What’s more, arguments against non-compete prohibitions are unfounded. First, the proposed FTC ban would still help to ensure that small businesses can protect their trade secrets while also creating space for entrepreneurship and small business growth. Second, states like California, Oklahoma and North Dakota, where these agreements cannot be enforced, have not reported any loss of business success or entrepreneurial spirit. 

Small businesses overwhelmingly want a level playing field, and non-competes don’t deliver because they are a threat to the free, fair and open competition that is essential to a thriving and equitable economy. That’s why more than 400 small businesses and small business organizations previously signed our letter urging the FTC to enact its proposed rule to ban non-compete agreements, and why we joined a coalition of small business advocates in signing a letter of support for the rule. Now, we will look forward to implementation of the new non-compete prohibition.


About Small Business Majority

Small Business Majority is a national small business organization that empowers America's diverse entrepreneurs to build a thriving and equitable economy. We engage our network of more than 85,000 small businesses and 1,500 business and community organizations to advocate for public policy solutions and deliver resources to entrepreneurs that promote equitable small business growth. Our deep connections with the small business community along with our scientific research enable us to educate the public about key issues impacting America’s entrepreneurs, with a special focus on advancing the smallest businesses and those facing systemic inequalities. Learn more about us on our website and follow us on TwitterFacebook and Instagram.

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