Reversing a five-year downward cycle that began in 2010, the rate of U.S. business startup activity increased during the past year at a pace not seen in two decades, according to the 2015 Kauffman Index of Startup Activity. Over the past two decades, the index generally has risen or fallen in tandem with the business cycle—up in the 1990s expansionary period and plummeting as the Great Recession that began in late 2008 took hold.
“The entrepreneurial activity increase in the 2015 Kauffman Index of Startup Activity represents the largest year-over-year increase in the last two decades, but startup activity is still below historic norms”
Kaufmann Index, 2015
(Hover over a year for more detail on this interactive chart.)
Highlights from the 2015 Kauffman Index
- .31 percent (310 out of 100,000) of U.S. adults started new businesses each month, on average.
- 62.2 percent of those starting new businesses were men. That 36.8 percent of the entrepreneurs were females is close the two-decade low of 36.3 percent in the 2008 index.
- The only age-group that didn’t see a growth in startup activity were those 45 to 54, which experienced no change from the prvious year.
- All racial and ethnic groups experienced increases in the rate of new entrepreneurs between the 2014 index and the 2015 index.
- 22.1 percent of those starting new businesses in the 2015 index were Latino.
- 28.5 percent of those starting new businesses in the 2015 index were immigrants.
Opportunity, not necessity, is the reason most people start businesses
“Opportunity entrepreneurs,” those who were neither unemployed or looking for a job before they started their new ventures, was 79.6 percent of the total number of new entrepreneurs. “Entrepreneurs starting new businesses because they saw market opportunities is back to historical norms,” said Arnobio Morelix, research analyst at the Kauffman Foundation, and one of the study’s authors. “When broad-based entrepreneurial opportunity improves at this pace, it’s an indication that the labor market is slowly recovering.”
(Photo: Rich Brooks via Flickr, CC BY 2.0)