Exposure to prolonged or repeated recessions, however, does adversely affect job creation. Firms that weather many recession years seem to consistently have lower levels of employment, the study showed, with startups surviving through three recession years having about 10 percent less employment than those surviving through none. This amounts to a difference of about 300,000 jobs, or around 0.2 percent of all jobs in the economy. While the number of jobs lost due to prolonged or repeated recessions appears to be small, these small differences might compound over the years and across groups of companies to create a lasting mark on the economy.
The current recession is the longest in several years; thus, startups established right before or at the beginning of the current recession might have been significantly affected.
Which is probably why companies that have been through recessions don’t immediately re-hire when the government statistics tell them the recession is over.
This recession was a bit different, in that fewer laid off people started companies than previously. Economists are still trying to figure that one out. Me, I think people are just shell-shocked by the real estate recession, the wild ride on Wall Street, and a slew of natural disasters. It’s a wonder anyone gets out of bed.
However, we’ve got to get these new company formations moving again. The question all entrepreneurs should be asking each other is what can we sell that people need, that involves people? Almost like a commune for the country? Can we get together and create a new reality? And if we come up with the ideas, there is definitely venture capital and angel capital to fund them. It just doesn’t want to fund another “me too” idea.
I’ve written about this before, and I’ve suggested infrastructure. Why not build the smart grid? Or the new water and sewer purification system? I also think small businesses are underserved. What about more micro-finance to disrupt the big banks that keep cutting those credit lines and credit limits small businesses depend on?
Smart people read this blog. Is anybody incubating some great idea in his/her mind? I would love to work with you on a world-changing project that would set the US back on track and restore optimism and energy. I am tired of listening to everybody piss and moan, including myself, about the state we are in:-)
{ 12 comments… read them below or add one }
You make such excellent, valid points, Francine. Shell-shock is a great way to describe how I think most people feel. I'm going to send your blog post to a good friend of mine in New York who works with venture capitalists. Perhaps she can help generate ideas or at least support your efforts. Thank you!
Thank you. There are so many good ideas and so many things to be done
that it's better to focus on building ne companies than generating
jobs:-)
You make such excellent, valid points, Francine. Shell-shock is a great way to describe how I think most people feel. I’m going to send your blog post to a good friend of mine in New York who works with venture capitalists. Perhaps she can help generate ideas or at least support your efforts. Thank you!
It is somewhat puzzling how people could have build this amazing infrastructure – an electrical grid that covers the whole US, telephone, highways, down to the local level streets, water, sewer, schools, and at the same time totally forgetting about planning for upkeep of all this infrastructure. Most sewer systems have been build 100+ years ago and now people act surprised when sinkholes appear. The electrical grid wastes energy and is not able to pick up the load. Did the people who build this not take future maintenance into account?
There has to be a cultural change to make thinking about the future, planning for more than short-term gain a priority. Also caring about your fellow citizens – its okay if someone homeless benefits from the clean water.
Thank you. There are so many good ideas and so many things to be donernthat it’s better to focus on building ne companies than generatingrnjobs:-)
It is somewhat puzzling how people could have build this amazing infrastructure – an electrical grid that covers the whole US, telephone, highways, down to the local level streets, water, sewer, schools, and at the same time totally forgetting about planning for upkeep of all this infrastructure. Most sewer systems have been build 100+ years ago and now people act surprised when sinkholes appear. The electrical grid wastes energy and is not able to pick up the load. Did the people who build this not take future maintenance into account?nnThere has to be a cultural change to make thinking about the future, planning for more than short-term gain a priority. Also caring about your fellow citizens – its okay if someone homeless benefits from the clean water.
That's right. We liked each other when we built all this stuff, and now that
we don't like each other as much, we are refusing to pay for something that
would be a big benefit to everybody.
Why not start implementing smart-grid technology at new businesses? Is it a money issue?
The part of the grid that leaks all the energy is in the big transmission part of the grid ( and now you have hit the end of my knowledge).
Francine Hardaway, Ph D
GV: 816.WRITTEN
That’s right. We liked each other when we built all this stuff, and now thatrnwe don’t like each other as much, we are refusing to pay for something thatrnwould be a big benefit to everybody.
Why not start implementing smart-grid technology at new businesses? Is it a money issue?
The part of the grid that leaks all the energy is in the big transmission part of the grid ( and now you have hit the end of my knowledge).rnrnFrancine Hardaway, Ph DrnGV: 816.WRITTEN