Is entrepreneurship declining?
I was listening to Software Engineering Daily podcast episode "Complacency with Tyler Cowen"
He mentioned that since the 1980's there has been quite a substantial fall in entrepreneurship. I won't quote him here but linked an article which describes the same statistic he mentions.
"For instance, measured as the ratio of new firms (those younger than one year) to total firms, then entrepreneurship in the US declined by around 50% between 1978 and 2011."
I was quite surprised by the statistic but I suppose I am a software developer and it made me realise the extent which I may be inside my tech bubble.
I'd love to hear all you indie hackers thoughts on this + recommend listening to the podcast episode. It is a concerning statistic in addition to the trends that are described of what the future might hold.
While true that over the past four decades the rate of new business is declining, there is some good news:
The article cites Nicholas Kozeniauskas's "What's Driving the Decline in Entrepreneurship?" paper, but funny how it doesn't mention that according to the paper:
(https://drive.google.com/file/d/1OCE3k5hWXic1cC7XqHbxtLidzRo5YViw/view)
which is hardly fair to all the indie hackers out there and the growing passion economy.
This is just talking but on obe side building a company is easier than ever -if you work in the knowledge economy- but at the same time many business tend to concentrate and it’s becoming harder to compete, not to mention that lots of things have already been solved -at least the most obvious-.
Then you have all the retail... mostly hurt to death...
Indeed, I'm just wondering is there more we can do in order to lower the barriers of entry into other industries, instead of all of us being stuck in the "knowledge economy" re-inventing todo-lists, calendar apps and email automation services until we are all extinct.
I also don't like subscribing to "a lot of things are already solved" but it can be hard not to feel it the odd time.
well, you can always collaborate with people from other industries. or work in an industry for a while, see what they need, and do it.
There are more brainpower and "prepared" people than ever in human history. And yet we put some of the smartest people on building shit products like Facebook :-) still, good things come out from time to time.
as dude working in fintech I agree, lots a human potential wasted in questionable industries.
Necessity is the mother of all invention as they say.
The West is overwhelmed with clothes, food, cars, electronics all of which apparently answer all of our needs. However, the developing countries have an endless shopping list of needs that have to be rectified in order to keep up with the West and growing population.
Most digital products for the consumer are created in such a way that it takes your full attention and rewards it with immediate endorphins (gamification basically). Is there any point in diving deeper into a personal interest? Or is it easier to stay on TikTok or YT and just enjoy the feel-good factor? Most will choose the latter, that's the problem.
We are so distracted by the news, media, Netflix and so on that it's basically on cruise control until an immediate need is felt like an economic crash, pandemics etc.
That is exactly what was mentioned generally in that podcast, it is almost like there is a massive lack of necessity. In addition a friend of mine feels it's given rise to this "scam" culture not just in selling but also from things like job adverts, but that's another topic....
The "necessity" part tho, on the other hand, sometimes you didn't know you needed something till it existed. Did we really NEED cars and planes i.e.
“All of humanity's problems stem from man's inability to sit quietly in a room alone.”
― Blaise Pascal, Pensées
Exactly, the UK is awash with scam culture and one of the things you will notice is that the UK is very quick at finding a loophole or way to earn money via illicit ways. It's both impressive and terrifying all at the same time.
I assume this quote is from way back because give someone Netflix, YT or social media and watch those problems magically 'disappear' for tomorrow.
I think the article is off base, they repeatedly tag the issue as declining population and I would say in their defense that a lot of mom and pop shops that may have qualified as entrepreneurial operations are dead thanks to big box stores. At the same time, I lived through the 1980's and food trucks were only at job sites, coffee shops were diners that served one kind of coffee, there were all kinds of service jobs that didn't exist then. There are more boutiques now even though malls are dead. Things are just different but the USA still has 30,000,000 SMBs in a country of 330 million. Among adults thats really about 20% of the population as owners of an SMB and almost half the country works at one.