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Startup trends examined in recent reports

April 09, 2020

While startups consistently create more jobs than older firms, the Federal Reserve Bank of St. Louis took a look at the trends in startup’s share of jobs and found that startup employment share has been declining for more than a decade. The Fed story provides an overview of startup employment dynamics between 1994 and 2018. While it found that the construction industry and leisure and hospitality industry contributed to the decline more than did the rest of the economy, the story calls for future research into the reasons behind the decline. Specifically, it notes that questions both about a decline in startups and about a change in employment dynamics among aging firms should be explored.

A separate report from the Kenan Institute of Private Enterprise and the Entrepreneurship Center at UNC takes a closer look at entrepreneurship. It reiterates findings of declining new firm creation, as well as lower job creation among existing high-growth firms, but also examines other views that contend the decline of business dynamism is overstated. An inaugural report provides insights into the topics affecting entrepreneurs, funders, ecosystem partners, policymakers and others in the innovation economy. Some of the high-level trends highlighted in the report cover funding a startup including successful exit strategies (not necessarily an IPO) and growth trends in private capital; building and supporting founding teams; what comprises an entrepreneur including facts on age and barriers for underrepresented founders; and concludes with next steps, which includes asking for additional conversations on the topics raised throughout the report.

The full report may be downloaded at frontiers.unc.edu. It is expected that the report will continue to evolve, building on the current analysis and introducing new topic areas.

startups, entrepreneurship