I wrote a post several months ago called “Is the Entrepreneurial Spirit Dead?” Well, according to new research at the Brookings Institute, it appears it very well may be. Their data shows that new business creation has been on the decline for the past several decades and for the first time in many years the failure of businesses is outpacing the creation of businesses. It seems that entrepreneurs across the country are getting discouraged.
This is a scary thought. According to the Small Business Administration roughly 64% of all net new jobs that were created between 1993 and 2011 were created by small business owners. If we aren’t cranking out any new entrepreneurs, we aren’t creating enough new jobs.
Before the economic collapse I had 3 great employees. As much as I tried to hold on to them, eventually I couldn’t keep them. Payroll is one of the biggest expenses a small business has. If there isn’t enough business coming in to justify having them, you have to let them go. And believe me, no one wants to lose a great employee.
This really makes me wonder. We have the lowest work participation levels in decades and the lowest levels of entrepreneurship in decades, so exactly how are people surviving? I guess the answer to that is “barely”. We’ve become a nation of part-time and temporary employees.
The economy won’t pick up until uncertainty is gone and entrepreneurs start to feel good about taking risks again.
Because that’s what entrepreneurship is really all about, risk. If we want to start innovating and creating jobs again, we need to feel safe enough to take risks.
As an entrepreneur, deep down I don’t think there is anything that will keep us down for long. It’s the new entrepreneurs I’m worried about. The ones that haven’t tasted that freedom and joy yet. Being an entrepreneur doesn’t mean you have to take out bank loans and mortgage your house. You just have to have a passion for what you do and a willingness to work hard for it.