A Record Number Of Americans Are Starting Their Own Businesses, Here’s Why
You'll be intrigued by the reasons why Americans are starting their own businesses at record rates.
This article is more than 2 years old
During the ongoing pandemic, many have started shifting to entrepreneurship. After a long decline in business creation, America has seen a new rise in workers investing in their own practices and enterprises. With tragic health benefits and pay from corporations nationwide, many are opting out for more significant and lucrative business possibilities. More than 5.4 business IDS applications were submitted by Americans wanting to start businesses in 2021.
The relationship between ID applications and actual businesses formed is usually parallel. Americans starting businesses increased last year exponentially, and 2022 appears to be no different. The Bureau of Labor Statistics noticed that the escalation of new companies also meant a rise in self-employment. Combined, these statistics show a new trajectory in national workforces: an attraction towards self-governed entrepreneurship.
Americans starting businesses in 2022 are very different from those who started businesses in the past. One of the first distinctions is a new group of entrepreneurs without college degrees. Internet accessibility has allowed brilliant minds to kickstart their own self-employment without the need to pay expensive tuition.
There’s also a rise in Americans starting businesses who were once excluded intentionally from independent success. Black Americans, women, and POC make up a large percentage of micro businesses initiated in the past two years. Women were responsible for starting 57% of online companies since March 2020, while they only counted for 48% in the year prior. There was a steep incline of businesses and ID applications for women and racially marginalized people in America in 2021.
The idea behind Americans starting businesses varies between people and demographics. Some are sick of dealing with unforgiving bosses, others have creative pursuits that didn’t fit their 9-5 lifestyle. Especially when the office transitioned to work-from-home, many saw an opportunity to monopolize their own ideas and creations.
Though many industries saw bursts of new businesses, retail experienced the most significant jump. Since the pandemic halted people’s abilities to shop in person, many retailers and beginner salespeople started selling their products online. The transition to online platforms galvanized everyday Americans to start businesses in clothing, jewelry, skincare, and makeup.
Another industry that saw a considerable expansion in the transportation and warehouse industry. Many saw the pandemic as a situation to expand delivery services. Americans starting businesses that had to do with tracking packages and no-contact delivery rose considerably, trying to tackle a pandemic-ridden America.
Though this change may threaten larger companies, entrepreneurship’s effect on the economy is indisputable. According to the Kauffman Foundation, a private company tracking entrepreneurship growth, most job development comes from businesses between zero to five years old. The acceleration of Americans starting businesses means more opportunity for everyone after many individuals lost their jobs due to COVID-19.
The record number of Americans starting businesses means tremendous benefits for those who’ve struggled throughout quarantine. Coined as the “Great Recession,” people are continuously opting out of regular employment for more unorthodox paths. Americans are quitting their jobs at record-high numbers, looking to invest in their own ideas. A resurgence of entrepreneurship only means positive outcomes for American workers everywhere.
