Entrepreneurism is on a slight rise, according to a new survey. In the second quarter, 8.7% of job seekers went back to work by starting their own businesses. This was an increase from 6.4% in first quarter 2009 and a low of 2.7% in fourth quarter 2008.
The increase comes despite credit that is still difficult to obtain and sluggish spending by businesses and consumers. John Challenger of the consultant firm Challenger, Gray & Christmas says, “Small business owners do not quite see the light at the end of the tunnel, but there is a sense that we have at least passed the halfway point. Once banks are in a position to open the lending spigot again, we are likely to see a surge in start-ups.”
Despite the increase, the numbers remain quite low compared to past years.
Even as the percentage of job seekers turning entrepreneurs edges toward 10 percent, it is unlikely that the start-up rate among the unemployed will reach levels achieved in the late 1980s and early 1990s. Between the inaugural year of the Challenger Index in 1986 and 1992, the start-up rate averaged 16 percent annually, peaking in 1989 when 20 percent of job seekers became entrepreneurs.
From 1993 to 1996, the annual start-up rate averaged 10.6 percent.