More individuals are starting businesses today than ever before. The reason for this may occasionally be that the chance cost, or the sacrifices they need to make to change into self-employed, is lower than ever before.
Data published by the US Census Bureau earlier this month shows that the full variety of applications to begin a business reached a record high of 5.5 million last 12 months.
That is half 1,000,000 more applications than were submitted in 2022.
Related: This is what thousands and thousands of small businesses have in common, in accordance with a brand new survey
Census Bureau data from the primary 4 months of this 12 months show that the startup boom is continuous: From January to April, the number of recent business applications totaled over 1.7 million.
Why are an increasing number of people submitting applications to begin a brand new business?
Professor at Columbia Business School Angela Lee told Entrepreneur The reason for this may very well be the “unprecedented number of layoffs at large technology companies in recent years, which has resulted in a large pool of talent becoming available for self-employment.”
Angela Lee, professor at Columbia Business School (left), and Andrea Turner Moffitt, co-founder of Plum Alley Investments (right). Photo by Monica Schipper/Getty Images)
Lee, director of the Eugene Lang Entrepreneurship Center, also noted that “historically, entrepreneurship has been countercyclical because the opportunity cost of starting a business goes down during a recession.”
Related: Want to begin a billion dollar business? Check out these two industries which have the most important unicorn growth
Major technology corporations have seen record numbers of layoffs lately.
According to Tracker, 263,180 employees within the technology industry worldwide were affected by layoffs last 12 months Layoffs.fyi.
Amazon fired probably the most People (27,410) last 12 months, but additionally Meta (21,000), Google (12,115) and Microsoft (11,158) contributed to the record numbers.
According to the newest employment report from the US Bureau of Labor Statistics, the unemployment rate within the US remained stable over the past nine months, ranging between 3.7 and three.9 percent.
Related: The April Employment Situation report shows that employers are hiring less and staff’ wage growth is slowing
