While the economy is making a slow recovery, some of the rebound could be attributed to entrepreneurs. A recent study by the Kauffman Foundation, reports that Florida had the largest increase in entrepreneurial activity over the past decade. This is great news for those seeking employment because startup companies are important for economic growth as most new jobs are created by companies that are less than five years old.
The study also found that:
- The lowest entrepreneurial activity rate was in the manufacturing industry.
- A majority of the new business owners were older - between 55 and 64 years old.
- Immigrants were twice more likely to start a new business than native-born Americans.
- Construction workers went into business for themselves to pick up whatever kind of work they could until the economy improves.
The Kauffman Foundation, a company that tracks business formation by using census data, also reported that last year, 320 out of every 100,000 adults in the United States started a business. This means that 543,000 businesses were created each month last year, which is the highest growth in the last 16 years.
In Florida, the growth rate was slightly higher with 380 out of every 100,000 people starting a business in 2011. The downside of these new businesses is that many were sole proprietors who went into business for themselves because they lost their jobs. This will not spur more jobs or grow the economy. These startup businesses are being cautious and prefer to be on their own until the economy picks up.
Source: South Florida Business Journal, "Florida among states with most entrepreneurial activity," Kent Hoover, March 20, 2012
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