Yes my numbers include the self-employed. The numbers actually come from a couple of sources, one of which was a study of New England microbusinesses completed by Prof. James McConnon, Jr. at the University of Maine. It is a “snapshot” study dating to 2004. I haven’t been able to get my hands on any longitudinal statistics to follow trends over time (if, indeed, the data is even available).

I look forward to continuing to share insights & perspectives. Who knows… maybe we can help lead the charge to finally bringing this forgotten sector of our economy to the forefront

Cheers!

Jack Speranza’s latest blog post: entrepreneurs & lawyers :: a strange but necessary marriage

I don’t really think we’re looking at the “end” of large corporations — although I’m told by my friend Brian Headd in the SBA Office of Advocacy’s Office of Economic Research that after this recession/adjustment “everybody’s going to be a bit smaller”.

I do think we’re going to see a shift in values that makes people still want to be a part of the best (if not the biggest) but that changes what we collectively consider the “best” to be.

The worst thing about 20th century corporate excess economics is its worship of “growth” at the expense of everything — including people, families, households. By the end, it was demanding that everything in American society be sacrificed to keep it going. A lot of people have been wanting to get off the treadmill and, for many, this recession has offered the opportunity.

For the rest of it, I’m wondering if you are including nonemployer businesses in your numbers? Nonemployers are where the real action has been, in terms of microbusiness population growth. They’ve increased in number from 15.9 million (69% of all U.S. firms) in 1997 to 20.8 million (77.5% of all U.S. firms) in 2006.

Self-created jobs are a sort of job creation that is not even being measured by the relevant parties but it is the only functioning source of new jobs in the economy right this second.

The greed factor is precisely why microbusinesses are routinely ignored, because those economic movers and shakers cannot comprehend the thinking of somebody whose business exists simply as the foundation of a life that they like, not to grow but just to be sustainable and to sustain.

Whole generations of Americans have been educated to be most comfortable in jobs where they do not have to make decisions or be responsible for much of anything or think very much. And there will always be people who answer that description available to fill traditional “jobs”.

Increasingly, however, it looks to me like more and more people want to more actively participate in their own lives. For them, self employment beckons.

As for when we get to celebrate, that’s hard to say. Senate Small Business Committee Chairwoman Mary Landrieu has been talking about having a hearing to discuss further differentiating different firm size classes within the vary large “small” designation, as she recognizes that microbusinesses have very different policy needs than, say, those almost-large small businesses with 425 employees or something.

That’ll be a good start.

Microbusinesses have historically accounted for about 20% of all employment in the US. Now consider that at least 1 in 3 of these employees includes the founder (an individual with entrepreneurial traits).

Though humans are capable of stretching themselves in times of distress, we gravitate to doing that with which we are most comfortable. Not everybody is comfortable being an entrepreneur / business owner. For this reason, I think the hostorical level of microbusiness activity is likely to remain the same.

There’s another human trait that drives this natural “ceiling” to microbusiness activity. It’s called greed. “Greed” can have lots of negative connotations, and these not the attributes I’m talking about. I refer to the healthy desire for profits, and the desire to be part of the biggest and the best.

This “greed” factor is what drives entrepreneurs to put their livelihoods at risk. It’s what drives investors to put their capital at risk. It’s what drives all the other institutions who support business activity to want to be a part of the next big thing.

Unfortunately, it’s also why you don’t see a lot of attention and support given to microbusinesses and their owners.

What these players fail to see is that while individual microbusinesses may not be “sexy” standing alone, as a group they account for at least one-fifth of all economic activity in our nation. That’s no small potatoes, and it’s the kind of “large” number that attracts interest and attention.

The current economy represents an opportunity for microbusiness to get the attention of government, the financial sector, and others relevant to supporting this key segment of our economy.

I look forward to joining you in celebrating the end of so many ignoring the importance of microbusiness. When do you think we’ll be able to make that pronouncement?

Jack Speranza’s latest blog post: entrepreneurs & lawyers :: a strange but necessary marriage

Their blindness won’t stop us from doing what we’re doing but it will make the transition to the 21st century economy take longer and be more painful than might have been necessary otherwise.

Loved your post and I’ve been seeing some very intriguing things coming out of the UK lately; makes me wish I had a good reason to visit London (and the cash to spare for plane tickets, of course!).

Thanks for stopping by and joining the conversation.

The Industrial Age dinosaurs of the 20th century are dying. Some don’t know it yet; for some who do, it’s a frightening specter. To me and many others, it’s a moment of opportunity. Jean Houston calls it Jump Time. I agree; it’s like the time – around 65 million years ago – when the earth cooled, and the huge dominant reptiles couldn’t adapt. The small warm-blooded mammals – our ancestors – were advantaged. They could maintain their body temperatures without depending on the environment. They could survive with far less fuel, because they were small. They could pass on adaptive habits to their young.

It’s our moment. We have so much to offer our communities. We can easily bring a personal touch. Slow and steady will get the job done.