Layoffs & questionable economy begin fueling wave of SMB ownership, entrepreneurship
Americans started working as independent contractors (19%) or decided to start their own business (18%) after losing their jobs.
Today’s ever changing economic landscape has many Americans considering alternative employment options, most notably entrepreneurship and small business ownership. This change may be attributed to the fact that nearly 1 in 10 U.S. adults (8%) have been laid off in the last 12 months.
Justworks and The Harris Poll surveyed working adults and small business owners to gauge their view on the ongoing uncertainty of the U.S. economy. The survey found that many Americans started working as independent contractors (19%) or decided to start their own business (18%) after losing their jobs.
Some working Americans are still hesitant to take the reins themselves, citing high barriers to entry. The primary barrier is not having enough money, or knowledge, to start. Outside of their locus of control, about 1 in 4 employed adults (22%) don’t feel the economy is favorable enough, now or in the future, for running a business.
Apart from the economy, the most commonly reported barriers to business ownership are not having enough money to get the business off the ground, not knowing where or how to start, and being afraid of any uncertainties involved in running a business.
Access to capital is the biggest concern for small business owners, however others reported struggling with complicated tax codes and managing payroll. Most wish they knew more about small business tax rules and wish there were better tools or resources to help them manage their business. Nearly 9 in 10 (87%) respondents agreed that having better resources to manage administrative aspects of the business would allow them more time to focus on the core processes of the business.
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While a majority of small business owners (59%) say that it has been easier than they anticipated to run a business, most small business owners who dealt with difficult aspects like managing health benefits (67%), legal documentation (64%) and filing taxes (61%) indicate it was more difficult than they expected.
Despite all the challenges and uncertainties, a majority of current business owners recommend small business ownership to others. That being said, the general consensus is that better and more plentiful tools or resources would help them more smoothly manage their business, especially with the ever changing economic environment.