So many of us muse about how nice it would be to work for ourselves. If you're your own boss, you're living the dream, right?
But is entrepreneurship for everyone? Absolutely not. For every person who feels comfortable navigating the ambiguity -- skiing unfamiliar slopes in the fog -- you'll find hundreds of others who'd prefer pulling a paycheck and having someone else lay out the tasks. They want what you might think of as a 'job-job' -- being an employee of an organization. So that leads us to ask where the more rewarding jobs might be found.
As a startup junkie, I've noticed that many entrepreneurs start out as solopreneurs. The majority begin that way, in fact. But for those who do quit their day jobs and go solo, quite a number wake up one day and realize their young business is bursting at the seams and they need to bring in help. They're creating jobs.
And what you'll find is that some of the coolest and most rewarding 'job-jobs' on the planet are the ones in startups and small businesses. Why? Because the folks running these enterprises tend to take the social contract with their employees more to heart than do the typical huge organizations run by professional executives and quarterly results. They appreciate the value of hard work. And the small business owners I know will do just about anything to keep the business on an even keel and protect their loyal people.
As I run into teammates from my prior startups, it's not uncommon for them to volunteer that our experience together was more fulfilling than any in their career before or since. That they would do it again in a heartbeat. While that's obviously gratifying to hear, I know it's not just my companies. As a student of the game, I've consistently found that kind of job satisfaction among employees in vibrant businesses run by entrepreneurs. Employees in such organizations tend to feel as if they're part of the band, that their contribution genuinely matters. They're not just a number.
How many new jobs do entrepreneurs create? According to the Bureau of Labor Statistics, startups in their first year of existence currently create around 2.5 million new jobs a year in the U.S., but that's down by nearly half from the boom times.
To paraphrase Prince, way back when we were partying like it's 1999 -- because it was... back in the dot-com boom -- we peaked in the U.S. at around 640,000 'new business births' a year, with each new business creating, on average, 7.5 jobs in its first year of existence.
As an economy, we've since sobered up, which isn't all bad, but it's been... well, sobering. Particularly since the crash of 2008, new business births have dropped, leveling off to a current level of around 500,000 a year. And more interesting, the average newly-launched business now creates five new jobs in its first year, down a third from Prince's heyday.
This isn't all bad. It's never been easier for prospective entrepreneurs to launch their business, and for folks with no business background to launch a new enterprise. With the extraordinary leverage available now from easy-to-use, cost-effective Internet and cloud resources -- from branding and website design and hosting to finance and accounting, app development to logistics, legal assistance to marketing promotion -- entrepreneurs need less capital, and are able to focus far more on their area of domain expertise rather than on being business jocks.
So we're starting to see more 'domain experts' -- whether in fly fishing or plumbing or personal training or rare books -- able to successfully launch businesses than ever before. Are they creating fewer full-time jobs for others? Yes, in large part because they're able to postpone hiring employees longer due to the efficiencies available from Internet resources and contractors. But meanwhile, they're providing indirect employment to a vibrant solopreneur ecosystem of contractors. And when they do pull the trigger to hire full-time staff, these small businesses are on a more solid footing.