2/3’S OF ALL JOBS ARE CREATED BY YOUNG SMALL BUSINESSES

KAUFMANN – WHERE WILL THE JOBS COME FROM

Where will the jobs come from Cover
Fully, 2/3’s of new jobs are created by small business.  New research documents that younger businesses, less that 5-years old are the businesses that create these jobs.
 
In October ’79 David L. Birch announced that small businesses created 2/3 of all new jobs.  The MIT Professor’s seminal research funded by the US Department of Commerce, Economic Development Administration transformed the practice of economic development. 
 
For the first time, economic development practitioners recognized that new business recruitment and expansion strategies could be further compartmentalized to focus on small businesses to increase the likelihood of successfully locating new jobs in their community. Birch’s transformational work has been verified many times over and today every economic development strategy gives due consideration to small business location and expansion.
 
Recent research published by the Kansas City based Kaufmann Foundation has taken this small business   one step further. During 2008, of the 12 million jobs created, Kaufmann Foundation research determined that 8 million jobs were created by not only small businesses but also small businesses less than 5-years old; fully 2/3 of the total annual new job growth.
 
To the economic development practitioner this has transformational meaning.  Strategies focusing on young new firms, entrepreneurial business start-ups, and second stage small business growth, demonstrate opportunities for quicker success in creating new jobs in local communities.
 
This coupled with information that small businesses create the vast majority of new jobs coming out of a recession  (see: NFIB Small Business Policy Guide)offers more documentation for inclusion of more meaningful emphasis upon small business formation and expansion in community economic development strategies. For community and economic development practitioners this new information might require rethinking of the community based economic development effort to include more entrepreneurial education, business start-up mentoring, assistance accessing business capital and provision of low-cost space for business formation and start-ups.
 
Chuck Eckenstahler.

Advertisements

Tags: , ,

One Response to “2/3’S OF ALL JOBS ARE CREATED BY YOUNG SMALL BUSINESSES”

  1. Craig Hullinger Says:

    Great Blog. Enjoy reading your viewpoint

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: