At the signing of an Executive Order on July 9 to promote competition in the American economy, President Joe Biden stated, “The heart of American capitalism is a simple idea: open and fair competition—that means that if your companies want to win your business, they have to go out and they have to up their game; better prices and services; new ideas and products.” The Executive Order directs every agency to address corporate consolidation and remove barriers that hinder innovation. This order, which is intended to lower prices for consumers, increase wages, and promote faster economic growth, can give small businesses and aspiring entrepreneurs across the country a much needed level playing field.

As the Co-Chair of Small Business for America’s Future, Frank Knapp Jr., summarized, this Executive Order “is an effective first step to creating a more equitable business environment for Main Street.” Another small business coalition, Small Business Rising said, “Today’s executive order is another sign that federal policymakers are serious about restoring competition and leveling the playing field for independent businesses, and we applaud the Biden Administration for taking this important step forward.”

But what does this all mean and let’s put it into some context.

Take a look at any Main Street across the country and you can see the effects of corporate consolidation. In the past 20 years, the number of companies controlling more than 75% of U.S. industries, including healthcare, financial services, and agriculture, has dwindled. This makes it harder for small and aspiring businesses with good ideas to break into markets, as the rate of new businesses forming has dropped by nearly 50% since the 1970s.

This consolidation does not make life easier for consumers and workers either. It makes it harder by driving up prices for goods and services and stagnating wages. Mark-ups, or charges over cost, have tripled since the 1980s and additional research finds that consolidation is decreasing advertised wages by as much as 17%. A report by the American Economic Liberties Project (AELP) estimates that this costs the median American household $5,000 per year. AELP’s Sarah Miller also stated on Biden’s move, “This order mandates that every agency in the federal government take on the problem of corporate concentration. With its initial recommendations, the White House is reshaping a broad range of highly concentrated markets, helping to unlock the full potential of the millions of innovators, producers, and workers that form the bedrock of America’s economic strength and dynamism, while also helping to protect families from price-gouging monopolists in industries ranging from airlines to internet services to medical devices.”