We have to. We can’t get anywhere working for someone else so we have to go out on our own. There are no such thing as 30 years and out “retirement” anymore and no other chance to meet our goals.
Can only comment for myself, but I started my business last january because my current income isn't keeping up with the rising cost of living. It was partly out of a necessity not want.
Women are the biggest contributor to the difference between 2019 and 2023 business rates. Black women in particular are incorporating more new firms. (Technically)
72.9% women cite job scarcity as the main reason for their business startup, compared to 67.2% men.
(World Economic Forum)
The COVID-19 outbreak and government-imposed restrictions lead to a surge in necessity-driven entrepreneurs around the world, with an increase of 95% in the United States, 20% in France, and 14% in Japan.
Necessity-driven entrepreneurs start businesses due to unemployment or financial difficulties.
This is a good sign and a bad sign. Good in the sense that it shows more people have the knowledge and ability to start a business, bad because it shows the current common employment models are not working for people, and people are seeking alternative ways to make money.
I am a franchise advisor and have worked with hundreds of people over the past four years. This is not correlated to PPP money but the pandemic which created a reset in many ppl add to that remote work and a general unhappiness with the corporate environment.
Really great! I could kick myself! Ha I had the best data on the most high profit, strategically positioned, could benefit socially etc….I can’t FIND IT!!!!!!
Would have been nice to see that continue under a Harris administration, with people getting a $50k tax deduction. Now, that number is going to go down due to tariffs. Prices are not going to drop. In fact, they’re going the opposite direction.
Not correlational with this uptick, but I believe ChatGPT and AI open the doors to entrepreneurs, enabling them to build businesses faster and cheaper than ever.
Of course, “starting a business” could mean many different things. It could be moonlighting or gig work, vs. going "all in". But I do find these numbers — esp in the US, where healthcare is *so* tied to your employer — telling.
But people are breaking up with traditional work --> (ctd)
Breaking up with it because they can't trust it to deliver for them.
And as the financial cost and friction of starting a business continues to plummet -- AWS, AI and ChatGPT, etc. -- the perceived risk of doing it, at least as a hedge, will too. --> (ctd)
Ditto, as more and more people start some form of business, others witness that -- and it becomes more normalized and ok to do; so the social costs plummet too.
All of this, combined w/ the fundamental scale of the web and the opportunities it offers, make me think we'll see this trend accelerate.
I just skimmed the paper, you only have the aggregate data right? Apologies if I missed it.
So you can't see, for instance, the proportion of new businesses started in 2020 that have since hired an employee? compared with that proportion from earlier years.
Granted, the barrier to entry is lower. The success rate however is daunting. According to 2024 data from the U.S. Bureau of Labor Statistics, 20.4% of businesses fail in their first year after opening, 49.4% fail in their first 5 years, and 65.3% fail in their first 10 years.
This really is worth digging in to. "Business applications". So it's not Schedule C tax data. It's probably local business licenses. You don't need that to do Uber, do you? So what kind of businesses are these?
One thing 2020 makes me think of in that chart is that one way to get a lot of new businesses started is to throw a lot of people out of work and kill a lot of small businesses. Creative destruction, I suppose, but . . .
Perhaps it’s more that a bit of time to ponder, a realization that life is too short to not take the risks, and a moment requiring creative solutions, people who otherwise wouldn’t have become business owners if they had stable employment find themselves taking matters into their own hands.
Another commenter noted that it's probably fraud due to PPP goverment payouts.
We could probably use regresion analysis to estimate how many were fake, exactly by comparing ot the Great Recession and other years in which businesses started .
The PPP loans were for businesses created prior to February 15, 2020. The incentive structure and hopes it would expand could explain some of the initial spike, sure. But the levels of business creation remain high even well after COVID relief dried out.
During and since the pandemic. Also, it looks like it's straight numbers growth and not per capita.
chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://rdeckernet.github.io/website/DH_businessformation_update.pdf
Is it full-time or just ppl claiming their side-hussles, uber, ir MLM as businesses?
What about the success rates? How many fail?
How many just break even?
Politicizing even the non political. The media + social media are mainly at fault. A bunch of idiots are left to explain science in a very mundanely limited manner that attracts online clicks. Explain economics, inflation, supply chain management should not be left to late night TV Host. Expects! 🆙
An interesting forecast I’d be curious to see is how much of this activity would be needed for the economy to absorb the massive amount of federal employees that are slated to be laid off by DOGE
Comments
72.9% women cite job scarcity as the main reason for their business startup, compared to 67.2% men.
(World Economic Forum)
Necessity-driven entrepreneurs start businesses due to unemployment or financial difficulties.
Starting a business has never been easier with tools, knowledge, and communities so accessible. 😊
maybe this is linked to some change in tax law or retirement law related to social security+income, or ira withdrawals or collaps of pension funds
https://www.hamiltonproject.org/publication/post/the-softening-labor-market-shows-resilience-and-some-pockets-of-slack/
https://bsky.app/profile/aaronsojourner.org/post/3kpxpax3ncp2b
I would think not
But people are breaking up with traditional work --> (ctd)
And as the financial cost and friction of starting a business continues to plummet -- AWS, AI and ChatGPT, etc. -- the perceived risk of doing it, at least as a hedge, will too. --> (ctd)
All of this, combined w/ the fundamental scale of the web and the opportunities it offers, make me think we'll see this trend accelerate.
Oh well
I must start one of these business where I don’t have to work.
Correct me if I am wrong, but the data is just new EIN applications? When we compare it to other countries, are we comparing apples to apples?
So you can't see, for instance, the proportion of new businesses started in 2020 that have since hired an employee? compared with that proportion from earlier years.
Let's get those small business booming in a competitive economy!
We could probably use regresion analysis to estimate how many were fake, exactly by comparing ot the Great Recession and other years in which businesses started .
chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://rdeckernet.github.io/website/DH_businessformation_update.pdf
https://www.brookings.edu/articles/surging-business-formation-in-the-pandemic-causes-and-consequences/
https://rdeckernet.github.io/website/DH_businessformation_update.pdf
What about the success rates? How many fail?
How many just break even?