I was surprised to learn from a 2010 Kaufman Foundation study that the number of new businesses started by entrepreneurs each year has remained constant since the 1940s, fluctuating no more than 7% in especially volatile periods but averaging 3 – 6% from then up to now. I would have thought that during these tough economic times, people would be flocking to start their own businesses in droves. But for a variety of reasons, being your own boss is not for everyone.
THE RIGHT CIRCUMSTANCES?
Some reasons to NOT start your own business might include:
- The need to bring home a steady paycheck
- Need for health benefits
- Low appetite for risk
- Lack of certain skills
- Lack of passion or desire
But as the worst recession since the Great Depression continues to limp along with an anemic recovery and an even bleaker employment picture, two articles I read in the New York Times seemed to indicate, at least to me, that in some cases, starting your own business is really the only way out. Here’s why:
CHINA’S GRADUATES STRUGGLE FOR JOBS
The front page New York Times article reported that China is cranking out 6 million college graduates a year who can’t find meaningful employment. “College essentially provided them with nothing,” one Chinese political scientist was quoted as saying.
6,000 MILES AWAY A PARALLEL UNIVERSE
In another section of the same issue of the New York Times was a similar yet much more inspiring article titled, “No Jobs? Young Graduates Make Their Own.” The gist? Young American university graduates were also finding it difficult to find jobs like their Chinese counterparts but the young grads spotlighted in this article were using their youth to their advantage by launching a variety of new businesses that had low barriers to entry, didn’t require a physical location or huge amounts of start-up capital and relied heavily on technology smarts and the Internet.
As the article states, “…entrepreneurship can be a viable career path, not a renegade choice, especially since the promise of “go to college, get good grades and then get a job” isn’t working the way it once did.”
And according to the National Association of Colleges and Employers, only 24.4% of 2010 college grads had a job waiting for them when they got out, so really, what do they have to lose? If nothing else, starting your own business will probably teach them more about business than any 4 years in school not to mention the contacts you make and the first hand lessons you learn.
Now let me just say that I’m not making any comparisons between American college grads looking for work and their Chinese counterparts. The point I’m really trying to make is that the employment/unemployment issue is a global issue. How you respond is the key!
OK BUT I’M NOT A 21-YEAR OLD COLLEGE GRADUATE
But if you’re like most of the people who read this blog you’re not a 21 year old college graduate from America or China. You’re more likely a middle-aged American business owner or a middle-aged unemployed, college-educated professional with years of experience in a chosen field. The problem? The world has changed around you but you haven’t.
But the fact is, if you’re thinking that this Internet thing is a passing fad, or longing for the day when Tweeting was something only birds did — you better just give up now. Because the tsunami of technological change that’s sweeping the business world is a continuing shift of power certainly unknown in my lifetime. It’s not going away. It’s truly a case of sink or swim.
A LIFE RAFT
That’s why throwing in the towel on job searches and hanging up a shingle for a new business might be a better alternative. There’s never been a better time to test the entrepreneurial waters. Take a few classes (I’ll be teaching a class on blogging at the Montclair State Continuing Ed Program in the Spring of 2011), read a few key blogs and join a few networking groups online and offline that deal in technology (The WordPress Group on LinkedIn is AMAZING!).
Also, ask questions, go to workshops, and don’t be afraid to hire or work with young people. I’m going to be 52 years old and all my employees and freelancers are in their twenties but we always teach each other something new. It helps that I love what I do and I’m “into” the Internet, web development, etc. But in the end, technology is just a means to an end. Use it. Or find someone who can use it for you. But try and keep your eye on the big picture and don’t let yourself get bogged down. Do you need to teach yourself HTML so you can build your own web? No. But understand the BENEFITS of having a website and how to use it strategically to start or grow your business. Do you need to know how to build a car to drive it? No. It’s just a way to get from here to there!