Business startups not employment offer better read of economy
The latest jobs numbers have been anticipated in the past week, though the greatest interest in the monthly statistics came from politicians and news organizations anxious for “fill” for newscasts. The Small Business Administration of Michigan’s June survey, reported in this issue of the Business Journal, should not be ignored amid the clamor and is no less significant. Even more significant, however, in this new millennium is measuring economic growth by the number of business startups.
The survey of 600 small business owners showed higher sales, higher profits, increased hiring and increased wages. SBAM spokesman Mike Rogers told the Business Journal, “Many of our members have told us that they are also seeing the positive impact of the Michigan business tax reform and are investing the tax savings into growing their businesses.”
That, too, reflects well in opportunities for entrepreneurs.
The June survey by Supply Chain Management Research at Grand Valley State University also showed continued modest growth in the manufacturing sector. Research director Brian Long noted that while job growth in the industrial sector tapered off, the main reason “continues to be the lack of qualified candidates. In fact, by some measures help-wanted advertising has increased to a higher level than before the recession began.”
Long also notes that the West Michigan region offers especially positive news with a 6.1 percent unemployment rate contrasted to the state’s 8 percent and well below the national average.
Real growth, however, is increasingly measured by the numbers of new businesses and entrepreneurial effort. In that regard, Michigan has moved ahead as a lead state. SBAM board member and Kentwood business owner David Fant notes the research showing Michigan’s “significant” improvement in the numbers of new entrepreneurs and business startups. Those numbers show in ever-increasing interest in the Grand Rapids Start Garden, the seed fund started by Rick DeVos that proffers $5,000 investments to the best entrepreneurial ideas selected by a panel of business experts.
In a recent interview with a Detroit Free Press columnist, longtime Fortune magazine technology writer and Techonomy Media founder David Kirkpatrick noted, “I don’t think anybody knows where the jobs are going to come from. … Self-employment, in a million guises, seems to be increasingly the direction of the U.S. economy.”
Kirkpatrick is leading a one-day “Techonomy” conference in Detroit in September featuring the founders and co-founders of LinkedIn and Twitter, as well as Ford Motor Co.’s chief technology officer to discuss Ford’s global mobility, which is “not just (about) cars,” Kirkpatrick said.
Perhaps Small Business Matters columnist Paul Hense sums it up best in his column this week: “Blame it on politicians, racism, unions or inevitable decay: The solution is in people’s capacity to own, operate and succeed in a small business.”