Jobs, Jobs, Jobs

Samuelson:  Startups Create Most New Jobs  (Newsweek)

Since the economic downturn began, I have read several theories regarding how to create more jobs.  Most of these arguments focused on the differences between big companies and small companies.  According to the above linked article, the real dynamic we should be looking at is old companies versus new companies.  "All the net job increases occur among startups, finds a study of the 1992–2005 period by economists John Haltiwanger of the University of Maryland and Ron Jarmin and Javier Miranda of the Census Bureau."

Here are three other facts I learned reading the Newsweek article:

1.  Between 1960 and 2007, the U.S. economy created 83 million jobs.  There were only six years of net job loss (1961, 1975, 1982, 1991, 2002, 2003).

2.  "There are more than 500,000 startups annually."  But, "Failure rates are high; half of new firms die within five years."

3.  "A company founded today has an 80 percent chance of disappearing over the next quarter century, reports a study by Dane Stangler and Paul Kedrosky of the Kauffman Foundation."

Interesting stuff!

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