The latest job creation figures from the federal government have confirmed what most economists have been saying all along: The climb back from the recession will be a long one so far as many laid-off workers are concerned.
For many of jobless or under-employed Americans, the answer is not waiting for that old job to reappear - but creating their own jobs by becoming entrepreneurs.
The U.S. Labor Department’s May figures showed that all but 20,000 of the non-farm jobs created last month were temporary government jobs at the U.S. Census Bureau. That’s hardly a reason to break out in a chorus of “Happy days are here again!” as it signals continued weakness in the private sector. As many economists have predicted, it will likely be 2011 – and well beyond in some metropolitan markets such as Milwaukee – before employment totals climb back to pre-recession figures.
Another report released in late May shows that many Americans are refusing to wait for Godot.
The annual “Kauffman Index of Entrepreneurial Activity,” issued by the Ewing Marion Kauffman Foundation since the mid-1990s, shows the recession has sparked interest in starting companies. According to the index, a leading indicator of new business creation in the United States, the number of new businesses launched during the recession has increased steadily since 2007.
The index measures the number of start-ups per 100,000 adults on a state-by-state and nationwide basis. In 2009, the 340 out of 100,000 adults who started businesses each month represented a 4 percent increase over 2008, or 27,000 more starts per month than in 2008 and 60,000 more starts per month than in 2007.
Wisconsin, after years of lagging well behind in the Kauffman index, is crawling out of the cellar to the main floor. Wisconsin ranked 28th among the 50 states and the District of Columbia in company start-ups, Kauffman reported in its May 20 report. That compares with 44th during 1997 through 1999.
There’s still a lot of room for improvement, but at least Wisconsin has escaped “bottom 10” territory.
Why is entrepreneurism so important? Wisconsin needs more start-up companies that can grow into tomorrow’s larger companies, thus regenerating the economy from the bottom up.
The stigma that once came with being an entrepreneur has largely disappeared as investors and governments realize the value of start-up businesses to the economy. In Wisconsin, state government has largely abandoned the “smokestack-chasing” approach to economic development, and wisely so. It has replaced that strategy with targeted marketing and outreach to specific industries and a ground-up approach to creating more homegrown companies.
What is an entrepreneur? Translated from its French roots, the word means “one who undertakes.” The term refers to anyone who undertakes the organization and management of an enterprise involving independence and risk, as well as the opportunity for profit.
Entrepreneurs tend to share common traits. They’re usually driven by a vision of what can be, and that vision may rest on an interlocking set of facts and ideas not yet known or accepted by the marketplace. Entrepreneurs take prudent, not rash, risks. They assess costs, market needs and other factors; they often write business plans to guide them. But they also recognize the plan may be thrown out the window if changing market conditions or other circumstances dictate a new direction. They are decision-makers, but usually make the best decisions when they consult others along the way.
How does society benefit from having entrepreneurs? Simply put, they re-energize the economy. They develop new markets, bring new resources to bear, mobilize capital and introduce new technologies, industries and products. Most important in today’s slumping economy: They create jobs. Small businesses in the United States provide the vast majority of new jobs, and often grow into tomorrow’s major companies.
Entrepreneurism isn’t for everyone, of course. But for those who recognize the old jobs won’t be coming back, building new ones for themselves and others is an option.
Tom Still is president of the Wisconsin Technology Council.
3 Comments
Absolutely superb suggestions! And I'd create that job in one of the service industries, as our politicians have effectively killed manufacturing in the US with NAFTA, CAFTA and giving subsidies to companies who out source to India. Health care is a growth industry with all of the new people added to the roles. More medical technicians will be needed.
But all of this should also tell you that what trashed our economy and jobs is our esteemed politicians. We need a 100% turnover in November.
Jack always makes some good and insightful points. But here he goes too far To me, what we're dealing with is change and it is not caused by politicians. It is caused by the world economy and technology, not by someone we elect to Congress. Our government is a representative democracy. Problem is, our representatives are representing themselves. They do what they think will get them elected, not what is good for the country. If Jack Kennedy were to write his book today, it would be entitled "Profiles in Expediency." We could elect a whole new Congress and within one term we would see that nothing has changed. It is us who need to embrace our changing demographic. It is us who need to realize that we need to invest to grow. It is us who need to understand.
Bob, what part of political money do you not understand? It works exactly as intended. Yes, re-electing a new congress would not change them, because the newbies would be owned by the same special interests that fund the current batch of crooks. It is the very reason this blog article was needed. Jobs!!! The trashing of the economy. This "change" was indeed caused by the politicians.