1.3 million people lost unemployment benefits this month. Some think fixing it will cost $25 billion (yes billion) a year. Small business creates two out of every three net new jobs. Maybe we should be investing some of those billions there? Ty Kiisel explores this issue.

The news is filled with stories about the 1.3 million people who lost unemployment benefits this month. Most people can think of at least one or two people they know who is out of work and has been for a very long time. And, for those who have been out of work for a while, it’s tougher than it’s ever been to find a job.

I have a friend who thought it would be a good idea to go back to school when he got laid off a few years ago. It sounded like a really good idea until he finished school and jumped back into the job market. Despite an incredibly successful career prior to the recession, apparently taking a couple years off to complete his education left too big a gap in his employment history.

After a year of job hunting, he’s now teaching at his university because the university was more interested in his work history and his newly completed degree than the private sector was.

Joshua Green, writing for Bloomberg reports, “Senate Majority Leader Harry Reid says he’ll try to pass a temporary extension (for unemployment benefits), but most Republicans have balked at the $25 billion-a-year cost.”

Former Administrator of the Small Business Administration Karen Mills, and current Acting Administrator Jeanne Hulit both talk about the important role small business has in creating jobs in the U.S.

According to Mills, 70 percent of jobs in our country are on Main Street.

“Today there are more than 28 million small businesses in the United States, and those firms create two out of every three net new jobs and employ half of America’s workforce," she said.

Ironically, those same job creators Mills identifies get the short end of the stick when it comes to accessing the capital they need to grow and hire new employees. According to the Federal Reserve Bank of Cleveland, while getting a business loan for their larger siblings has become easier, it isn’t for the smallest small businesses.

Granted, the SBA loan guarantee program isn’t the largest source of capital for small business, but I believe they play an important role in how banks and other lenders look at small business. In light of the fact, I also find it ironic that we’re looking down the barrel at a potential $25 billion extension of jobless benefits while the SBA has been responsible for guaranteeing only around $30 million a year for the last three years.

It seems to me we could make a better investment in job creation by increasing our ability to create jobs by investing in small business. I’m sure there will be those who suggest this is an oversimplification of what it takes to address the needs of those who are suffering from unemployment. Nevertheless, as credit has eased for mid-sized businesses, large businesses, and even the largest small businesses, it still remains very tight for the smallest small business that Mills called the job creators.

I’m not advocating we open the floodgates and recreate the savings-and-loan debacle of a few years back, but I am suggesting moves like those taken in October by Hulit that removed fees on SBA loans of $150,000 or less are a great start.

I hope we don’t stop there.

I would like to see our representatives in Washington generally, and the SBA specifically, do more to encourage banks and other lenders to offer small business greater access to capital. I would much prefer to see more small business lending than the potentially never-ending need to extend unemployment benefits because there just aren’t enough jobs in our country.

Fortunately for small business, there are more options available to small business owners than ever before. We regularly talk about some of them here. Unfortunately, there still not enough. Accessing capital is one of the biggest challenges faced by small business owners. I think we have an opportunity to enjoy the best of two worlds: help grow the small business job creation machine and put a dent in the unemployment rate at the same time.

Green points out, if we do nothing, we’re likely looking at another 3.6 million workers who will see their unemployment benefits dry up this year. I don’t think we can afford to continue to pay Peter by robbing Paul for much longer.

A Main Street business evangelist and marketing veteran with 25 years in the trenches, Ty Kiisel writes about small business finance issues for and is author of the book, "Getting a Business Loan: Financing Your Main Street Business."