More than 80 percent of businesses in the United States are nonemployer firms, meaning that they have no employees besides the owner. Together, they make up just 3 percent of annual business receipts, but they contribute to economic activity in other ways that are not captured in aggregate statistics.
From a societal standpoint, self‐employment is an important source of alternative income and provides a possible path up the economic ladder. The option can be especially important among those whose employment options are limited due to language barriers, lack of formal education, or a need for flexible work arrangements. Three demographic groups with increasing self‐employment rates, for example, are women, minorities, and immigrants (Survey of Business Owners 2002 and 2007). From a macroeconomic perspective, nonemployers are an important starting point for many larger firms. Not only do they serve as a proving ground for ideas (Dunn and Holtz‐Eakin 1996), but they also have much higher rates of creation and destruction than employer firms do. High levels of "dynamism" have been linked to both productivity and employment growth in the overall economy (Decker, Haltiwanger, Jarmin, and Miranda 2014).
Econintersect wants your comments,
data and opinion on the articles posted. As the internet is a
"war zone" of trolls, hackers and spammers - Econintersect must balance its
defences against ease of commenting. We have joined with Livefyre
to manage our comment streams.
To comment, using Livefyre just click the "Sign In" button at the top-left corner of
the comment box below. You can create a commenting account using your
favorite social network such as Twitter, Facebook, Google+, LinkedIn or
Open ID - or open a Livefyre account using your email address.
You can also comment using Facebook directly using he comment block below.
Print this page or create a PDF file of this page
The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.
Take a look at what is going on inside of Econintersect.com