Governors across the United States are launching a coordinated push to dismantle bureaucratic barriers that prevent millions of Americans from starting their own businesses. Oklahoma Governor Kevin Stitt unveiled a new compact at the National Governors Association’s 2026 Winter Meeting, calling on state leaders nationwide to prioritize entrepreneurship through concrete policy reforms. The initiative arrives as government data reveals a troubling gap between aspiration and action: while 62 percent of Americans want to launch their own ventures, fewer than 7 percent actually do so annually.
The compact represents more than symbolic gestures. Governor Stitt issued Executive Order 2026-04 in Oklahoma, establishing clear administrative pathways to reduce the time and expense of business formation. His proposal asks fellow governors to appoint senior officials dedicated exclusively to entrepreneurship, create one-stop digital platforms for licensing and permits, and mandate regular public reporting on startup activity and job creation. These aren’t theoretical recommendations. They’re operational frameworks designed to address what economists call “administrative friction”—the accumulated costs of compliance that disproportionately burden first-time founders.
Research from the Kauffman Foundation consistently shows new businesses generate nearly all net employment growth in the American economy. A 2023 analysis found startups less than one year old created an average of 3 million jobs annually over the previous decade, while established firms showed minimal net job creation. The Federal Reserve Bank of Kansas City reported in 2024 that regions with higher business formation rates experienced wage growth 1.8 percentage points above the national average. These aren’t marginal effects. They represent fundamental drivers of household prosperity and community renewal.
Yet regulatory complexity has expanded dramatically. The Small Business Administration documented that federal compliance costs alone totaled nearly 12,000 dollars per employee for firms under 50 workers in 2023, roughly double the per-employee burden faced by large corporations. State and local requirements add thousands more. A prospective restaurant owner in many jurisdictions must navigate health departments, zoning boards, liquor authorities, tax agencies, and building inspectors before serving a single customer. Each interaction demands fees, waiting periods, and specialized knowledge that favors those with existing resources.
The compact acknowledges this reality directly. Governor Stitt’s framework calls for comprehensive regulatory reviews focused specifically on startup costs and timelines. Delaware reduced business formation time to under 24 hours through online systems. Georgia eliminated multiple redundant filings by consolidating state registrations. Indiana cut initial filing fees by 40 percent while maintaining revenue through volume increases. These reforms didn’t weaken oversight. They removed unnecessary duplication and translated paper processes into digital workflows.
The economic argument for entrepreneurship extends beyond employment numbers. The Brookings Institution found in 2024 that counties with above-median startup rates showed greater resilience during economic downturns, with unemployment spikes averaging 2.3 percentage points lower than counties with below-median formation rates. New businesses force existing firms to compete on quality, price, and innovation. They introduce products that established players overlook or dismiss. They provide alternatives when dominant companies exploit market power.
Teaching entrepreneurial skills represents another compact priority. Currently, most K-12 systems emphasize employee preparation rather than business creation. Students learn to follow instructions and complete assignments, valuable skills that nonetheless leave them unprepared to identify market opportunities, assess financial viability, or manage operational complexity. Several states have begun integrating entrepreneurship into standard curricula. Utah requires all high school students to complete a business planning module. Michigan established Innovation Zones allowing students to develop and test actual products. Arizona created dual-enrollment programs linking community colleges with entrepreneurship centers.
The compact’s emphasis on measurement matters because governments manage what they track. Most states monitor unemployment rates, wage levels, and major corporate relocations. Few systematically measure business formation rates, first-year survival percentages, or startup job creation. Without consistent data, policymakers cannot evaluate which interventions actually work. The Census Bureau’s Business Formation Statistics provide monthly national data, but state-level granularity remains limited. Governors who commit to tracking and publishing startup metrics will create accountability mechanisms that survive beyond individual administrations.
Critics might argue that entrepreneurship initiatives primarily benefit already-advantaged populations. Middle-class professionals with savings, credit access, and professional networks face lower barriers than working-class individuals juggling multiple jobs without financial cushions. This concern has merit. The Federal Reserve’s 2024 Survey of Household Economics showed that 37 percent of adults could not cover a 400-dollar emergency expense using cash or savings. Someone in that position cannot realistically quit employment to launch a venture, regardless of regulatory streamlining.
Yet reducing barriers helps precisely those populations most. Wealthy founders can hire attorneys and consultants to navigate complex requirements. They absorb delays and fees as minor inconveniences. Working-class entrepreneurs lack those buffers. A 500-dollar licensing fee represents weeks of income. A three-month waiting period means three months without revenue while expenses continue. Research from the National Bureau of Economic Research found that reducing occupational licensing requirements increased business formation rates most dramatically among Black and Hispanic populations, who face disproportionate barriers to traditional employment advancement.
The compact will culminate at the National Governors Association’s Summer Meeting in Oklahoma City, where participating governors will present specific actions taken under the initiative. This timeline creates accountability pressure. Governors who sign without implementing reforms will face questions from business communities and political opponents. Those who deliver measurable results will gain models to promote and electoral benefits to claim.
American entrepreneurship has declined from historical peaks. The rate of new business formation fell nearly 30 percent between 1978 and 2011 according to Census Bureau data, though it has partially recovered since 2020. Multiple factors contributed to this decline, including industry consolidation, increased capital requirements in some sectors, and the expansion of occupational licensing. Reversing these trends requires sustained policy focus rather than isolated programs.
Governor Stitt’s compact offers a framework, not a mandate. Each state faces different economic conditions, political cultures, and administrative capacities. What works in Oklahoma may require adaptation in Oregon. The value lies in establishing entrepreneurship as a legitimate governor-level priority worthy of senior staff, dedicated resources, and public accountability. If even a quarter of states implement meaningful reforms, the resulting experimentation will generate valuable evidence about what actually reduces barriers and increases business formation.
The initiative’s success ultimately depends on whether governors move beyond rhetoric to implementation. Creating a chief entrepreneurship officer means nothing if that position lacks authority and budget. Establishing one-stop digital platforms requires sustained technology investment and inter-agency cooperation. Reducing regulatory burdens demands political willingness to challenge entrenched interests who benefit from complexity. These are not easy tasks. They require governors to spend political capital on reforms that may not produce visible results for years.
But the economic and social potential justifies that investment. Every person who successfully launches a viable business represents a household lifted, a community strengthened, and an economy revitalized. Multiply that by thousands across all fifty states, and the cumulative impact could reshape American economic dynamism for a generation. The compact represents an invitation to make that possibility real through concrete policy action rather than aspirational statements.
