Despite the fact that the U.S. economy has been growing steadily since 2009 (as measured by gross domestic product adjusted for inflation), some studies suggest that 59% of entrepreneurs believe that it is harder to open and run a business in today’s economy than five years ago.
But are these “Debbie Downer” predictions accurate? Does the economy, the challenge of finding new customers, and pressure from direct competitors actually make business-building harder today than during the country’s Great Recession?
If you take a look at the data, you’ll see that the numbers are much more promising.
One metric we can examine when it comes to predicting entrepreneurship is the amount of venture capital given out to promising startups. Venture capital—a source of equity financing from non-traditional investors for startups and small businesses—has actually been growing. In early 2014, venture capital funding was at its highest level since 2008, and while 2013-2014 saw a 15% decrease in the number of investments made, those years also enjoyed a 13% increase in the total amount of money invested.
Hiring trends also offer insight into the state of entrepreneurial expectations. A steady increase in hiring—especially full-time workers versus part-time workers—suggests confidence in the business environment and is correlated with greater levels of overall success.
And, indeed, when we look at the numbers, we can see:
- An increase from 49% to nearly 67% of small businesses making full-time hires between 2012 and 2015.
- An increase from 19% to 24% of enterprises taking on part-time workers over the same time period.
When taken together, it’s clear that our collective entrepreneurial outlook is rosier than some pundits would have you believe. Worldwide, the number of entrepreneurs who want to start a new business has increased from 70% in 2012 to 77% in 2014, while 86% of U.S.-based entrepreneurs are planning to start a new business this year.
Are you one of these 86%? If starting a new business is on your radar for 2015, take a look at the statistics I’ve compiled to help predict the environment that entrepreneurs can expect to enjoy this year. Check out the full infographic now: