The Small Business Administration reports that entrepreneurs are the leaders in driving economic recovery with small businesses creating 64 percent of net new jobs over the past 15 years.
Now a new study from the Kauffman Foundation indicates that young companies create a disproportionate share of new jobs, which may mean that entrepreneurs who are just starting business formation could offer the best hope for national recovery.
The study shows that “gazelle firms” – fast-growing business entities between three and five years old – comprise less than 1 percent of all companies, yet they make up roughly 10 percent of new jobs in any given year.
Robert E. Litan, vice president of research and policy at the Kauffman Foundation, says he hope these statistics will inspire entrepreneurs to pursue business formation. “While some new companies will undoubtedly fail, high-growth firms must be started somehow, and the more quickly they are launched and in larger numbers, the faster both output and employment will grow,” he said.
To learn about how to incorporate a business, entrepreneurs can seek the guidance of professionals at an incorporation service. This may benefit prospective business owners, the economy, and the nation’s unemployed.