With the decline of the overall economy, we wondered what was happening with entrepreneurs. Were they increasing in number? Were they decreasing?
Fortunately for us, the Cleveland Federal Reserve did a study
. As they said at the outset, no single variable encompasses all entrepreneurship. But there are certainly good places to look. One is self employment numbers. The Cleveland Fed found that they were down. Click the link and read the whole thing.
Here is their summary, “Despite the claim that recessions are a time of opportunity for entrepreneurs, the Great Recession had a negative impact on U.S. entrepreneurship. At the end of the recession, the United States had fewer businesses and self-employed people than it had before the downturn began. While some measures indicate that a big part of this decline came from the increased closure of existing businesses, the largest effect came from a decline in new business formation, particularly for businesses with employees, the more economically substantial type of business.
Moreover, the data show that the negative effect of the Great Recession was largest on the most substantial entrepreneurial efforts, adversely affecting new employer firms more than nonemployer businesses, and incorporated self-employment more than unincorporated self-employment. By most available measures, the Great Recession’s effect on entrepreneurship was negative.”