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Americans filed papers to start 4.3 million businesses in 2020, the U.S. census bureau reported, 24 percent more than in 2019 and the most in a single year during the 15 years that the agency has tracked the statistic, according to The New York Times.
The volume of applications is still rising this year, the NYT noted.
The surge reverses a 40-year trend of the entrepreneurial sector’s weakness.
In 1980, 12 percent of employers were new businesses; by 2018, the most recent year for which figures are available, the number had shrunk to 8 percent, a decline of one third, the NYT reported.
Because new businesses are key sources of innovation and job growth, the downward trend had worried economists.
However, 2020’s economic shutdown forced many laid-off workers to create their own jobs; others, locked out of restaurants, gyms, theaters, and their other usual forms of entertainment, used that time and pent-up energy to launch their own ventures.
“The pandemic forced a realignment that we never would have seen otherwise,” John Lettieri, CEO of the Economic Innovation Group, told the NYT.
“I hope this was the definitive moment when the sclerosis broke,” he said.
Many of the new businesses were in sectors in which workers had lost their jobs, such as retail, food services, and logistics; but construction, finance, manufacturing, and other sectors also saw a wave of new enterprises, the NYT found.
The boom may not last; not every application for a business license turns into a functioning business. The census bureau tracks applications for new businesses weekly but will not be able to report the number of actual businesses in operation for years, according to the NYT.
Also, with the economy restoring jobs, entrepreneurs may shelve fledgling or struggling businesses to reclaim the security of a regular paycheck.
Still, the trend may be taking hold: in July, the proportion of U.S. workers describing themselves as self-employed notched an eight-year high, the NYT said.
TREND FORECAST: Tired of being a plantation worker of Slavelandia, and moving into a new mental state during lockdowns and time off from work… freer thinking segments of the population have begun to create their own reality rather than being subservient to a corporate master.
With the world in flux like never witnessed in recorded human history, there are excellent OnTrendpreneur® opportunities to thrive in the New ABnormal world of disorder.