Posted on 12/09/2015 8:24:32 AM PST by SeekAndFind
Despite the hype surrounding tech "unicorns" — the myriad of startups that are valued at over $1 billion — the number of entrepreneurial endeavors in the US has actually been declining for some time now.
According to researchers, not only are there now fewer startups being created in the US, but the slowing rate of entrepreneurship is hurting the economy.
"Historically, the U.S. has exhibited a high pace of entrepreneurship with a small share of fast growing young firms disproportionately accounting for job creation and productivity growth," said the new study. "The decline in startups and the accompanying decline in high growth young firms either suggests adverse consequences for U.S. economic growth or a change in the way that such growth will be achieved."
The researchers -- Ryan Decker of the Federal Reserve, Ron Jarmin and Javier Miranda of the US Census Bureau, and John Haltiwanger of the University of Maryland -- analyzed the rate at which startups are adding employees and found that the number of high-growth firms has decreased significantly.
"In 1999, a firm at the 90th percentile of the employment growth rate distribution grew about 31 percent faster than the median firm. Moreover, the 90-50 differential was 16 percent larger than the 50-10 differential reflecting the positive skewness of the employment growth rate distribution," said the study.
"By 2007, the 90-50 differential was only 4 percent larger than the 50-10, and it continued to exhibit a trend decline through 2011."
Essentially, there has always been a large number of startups in the US. Of those startups, a select few are able to catch on and heat up quickly. These firms hired a disproportionate number of people, helping to stimulate the labor market.
(Excerpt) Read more at businessinsider.com ...
There was a report this morning that 80% of small businesses are turned down by banks for loans, so they are turning to micro-lenders, which is done in third-world countries. Obama must be proud.
I’m so surprised.
Liberals in this country have made business and industry so burdened with bureaucracy, taxes, and regulation that it discourages, not encourages growth.
They don’t want people working for themselves, they despise capitalism. They want the government to be the provider of everything, including your paycheck.
But hey, according to the Federal stats, we have hundreds of millions of new jobs created since 1989.
Yep. Exactly so.
Good article. It was all explained in “Rollerball” too.
Where did the author get that statement from? Just pulled out of thin air, or cherry-picked from some poll somewhere. That is BS, I think.
But I did appreciate the comparison to Kulaks, which is apt.
I had my own software company for 17 years but finally sold it to a larger company. The laws, regulations, and forced payments (e.g., ObozoCare) took all of the profits and fun out of owning a business. Look at the OSHA rules. To “legally” put up a ladder against a wall, you need to calculate the tangent of theta to do it correctly...27,000 pages of this sh#t. The EPA and other regulatory agencies are out of control. They grow unfettered because Congress has abdicated its oversight and the heads of those agencies know that their power and prestige hinges on the number of people they employ, not what they do for US citizens. I long for the deregulation days of Reagan.
Come on now this can’t be right. Last Thursday they told us unemployment was below 5% and the economy is booming. /s
“There was a report this morning that 80% of small businesses are turned down by banks for loans, so they are turning to micro-lenders, which is done in third-world countries. Obama must be proud.”
My son-in-law, up until the messiah took office, used to fairly easily obtain million dollar loans for construction contracts. Once the messiah got in, that quickly changed. Despite having a perfect record on fulfilling his business contracts and paying loans on time, the banks quit loaning him money, even on government contracts. He was climbing the ladder of success, with each new job picking up another needed piece of heavy equipment, but didn’t quite get far enough ahead to be able to self finance all the overhead on new contracts, the banks quit lending, and now he and the people he used to employ sit idle, or are back to working for those who have the overhead on hand.
Muslim Womens Clothes! Just sayin.
What? All those immigrants over the past year or so,, , havent actually helped the economy ??
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