Job creation

The Entrepreneurial Way to 4% Growth is a recent Wall Street Journal article. Online subscribers can read the whole article at the link. Others who want to do so will need to find another way, e.g. a library.  Some quotes from the article are:

1. New firms are the country’s principal generator of new jobs. Data from the Kauffman Foundation suggest companies less than five years old create more than 80% of new jobs every year. While the nation seems more enthusiastic than ever about the promise of entrepreneurship, fewer than 500,000 new businesses were started in 2015. That is a disastrous 30% decline from 2008.

2. Silicon Valley [ ] already receives disproportionate attention from Washington. This sliver of the nation’s entrepreneurs—high-tech companies and the venture-capital investors who fund them—has shaped the narrative of entrepreneurship for too long. By my estimation, these “rock star” firms, less than 5% of all startups, have much higher failure rates and create proportionately fewer jobs than the 40% of all new businesses started every year by franchisees.

3. The application of complex Dodd-Frank provisions has led community banks to finance fewer and fewer promising businesses—despite their unique knowledge of local markets.

4. Anti-growth policies like ObamaCare and minimum-wage increases make hiring workers prohibitively expensive.

The following are my comments.

- The US Gross Domestic Product (GDP) fell 2.9% in 2009, the worst result since The Great Depression in the 1930's. Like me, one might expect that the subsequent GDP growth would have been quite good. It wasn't. I have no doubt that the policies of Barack Obama and his administration contributed a lot to the anemic recovery. See here, then click on MAX to show the most years. Indeed, BO's presidency was the first ever to not have a year of at least 3% GDP growth.

- Contrary to the WSJ article, about 2 years ago Hillary Clinton asserted in a speech: "Don't let anybody tell you that, you know, its corporations and businesses that create jobs." What a remarkably stupid comment! Google, Amazon, Facebook, Uber, etc. each employ 1,000's of people, but started with a handful at most.  

- It would be interesting to learn more about job losses, e.g. (a) sorted by small, medium, and large businesses, and (b) sorted by the age of the firm.