New Business Formation

[jyl]

https://wolfstreet.com/2020/11/27/this-surge-of-new-businesses-during-the-pandemic-is-a-doozie-on-several-levels/

You may have heard that new business formation has been on a tear this year. No, it is not a scheme to fraudulently get PPP loans. But it also isn’t a surge of job creation. It is mostly people starting one-or-two person companies, becoming independent contractors and sole proprietors instead of W2 employees, maybe after losing their jobs.

The linked article does a really good job of explaining this. As he points out, the great majority of these new businesses will stay small, providing only a few “jobs” per business.

(I’m an example. I quit my job and started my own office in February, it is providing me with a decent livelihood and I have ambitions of growing, but I do not intend to be an “employer”.)

Anyway, I thought this was interesting.