Kauffman Foundation News (3/7/11): “Jobless Entrepreneurship” Dims 2010 Startup Activity

‘Jobless Entrepreneurship’ Tarnishes Steady Rate of U.S. Startup Activity, Kauffman Study Shows
During the Great Recession, more Americans have become entrepreneurs than at any time in the past 15 years. However, while the economy and its high unemployment rates may have pressed more individuals into business ownership, most of them are going it alone, rather than starting companies that employ others.

According to the “Kauffman Index of Entrepreneurial Activity,” a leading indicator of new business creation in the United States, 0.34 percent of American adults created a business per month in 2010, a rate that remained consistent with 2009 and represents the highest level of entrepreneurship over the past decade and a half. In contrast, however, the quarterly employer firm rate has dropped from 0.13 percent in 2007 to 0.10 percent in 2010.

Capturing new business owners in their first month of significant business activity, the Kauffman Index of Entrepreneurial Activity provides the earliest documentation of new-business development across the country. In addition to this overall rate of entrepreneurial activity, the Kauffman Index presents separate estimates for specific demographic groups, states and select metropolitan statistical areas (MSAs). It provides the only national measure of business creation by specific demographic groups.

Read more about the 2011 Index findings and see interactive data spanning all 15 years at www.kauffman.org/kiea2011.