American Entrepreneurship has Declined 53% Since Reagan
On Tuesday - in a rare-act of bipartisanship - the Senate passed the Small Business Jobs and Tax Relief Act. The legislation is aimed at giving some much-needed stimulus to America’s entrepreneurs - by giving any small business that hired more workers in 2012 a 10% tax credit. It also gives away new tax credits for small businesses that invest in new major equipment. It’s no secret that small businesses have taken quite a hit following the Bush Great Recession.
But there’s new evidence out now that suggests American entrepreneurial class has been suffering for a long time before Barack Obama - or even George W. Bush - moved into the White House. In fact - the evidence shows that American entrepreneurs have been getting pummeled for more than thirty years now. According to a new study released today by the New American Foundation, the number of entrepreneurs per capita has dropped by 53% since 1977. And since 1991, the number of Americans who are self-employed has dropped by more than 20%.
In other words, Americans who use to be able to start their own businesses are increasingly being forced to join the ranks of the working poor. Our nation - quite frankly - has forgotten how to foster an entrepreneurial class over the last thirty years. So why is that?