entrepreneurship

Useful Stats: Sectoral breakdown of total and high-propensity business applications, 2005-2023

Led by increases in retail trade and professional, scientific, and technical services, the number of annual business applications nationwide has increased 119%, or nearly three million, from 2005 to 2023. However, the share of applications classified as high-propensity, or those more likely to result in businesses with a payroll, has decreased in all but the health care and social assistance sector, leading to a 26-percent point drop (58% to 32%) over the same period.

Event recap: How ecosystem mapping can aid your region

In SSTI’s recent TBED Community of Practice webinar, representatives from SourceLink and EcoMap Technologies shared practical insights on how ecosystem mapping supports both entrepreneurship and regional economic development.

Useful Stats: Business applications trending up, share of high-propensity applications trending down, 2005-2023

Business applications have greatly increased over the last two decades, jumping 119% from 2005 to 2023. However, the rate of high-propensity business applications—applications identified by the Census Bureau as having higher likelihoods of turning into businesses with payroll—have decreased as a share of all applications every year since 2005, despite having grown 22% over the same period. Breaking these numbers down by states shows uneven trends, with the difference in shares of high-propensity business applications in 2005 and 2023 decreasing by over 20 percentage points in most states.

Useful Stats: Most sectors on a downward trend in high-growth firms

Shrinking shares of job-creating, high-growth firms across the country, the topic of SSTI’s Useful Stats column in last week’s Digest, is not being experienced within all sectors of the economy, according to analysis of the Business Dynamics Statistics of High Growth Firms (BDS-HG) experimental dataset from the Census Bureau. From 1978-2021, the number of high-growth firms, measured by change in employment, has increased in five sectors, stayed the same in one, and decreased in the remaining 13 classifications of U.S. business and industrial activity. Slower-growth firms expanded their dominance of the economy, as all sectors experienced a decrease in the number of high-growth firms as a percentage of their total respective firms.

Useful Stats: High-growth firms on the decline nationwide

High-growth firms are often conflated with all other firms. Unfortunately, this tendency makes it extremely difficult to differentiate those with a higher likelihood of significantly impacting the economy and innovation. While reports like the Global Entrepreneurship Monitor (GEM) have found increasing rates of entrepreneurship over the past decade, barring a drop at the onset of the pandemic, new U.S. Census Bureau data on high-growth firms reveals the opposite for the number of high-growth firms, with steady, significant decreases in the number and share of high-growth firms across the nation.

Useful Stats: The new US Census Bureau high-growth firm data set, 1978-2021

Information on the geographic distribution of innovation and entrepreneurship is not easy to tease out of many federal statistical data sets, leading regional policy often to be based on trends in all business starts or life span and size—ignoring the fact that some firms have greater impact on regional economic growth than others. The U.S. Census Bureau is well aware of the challenge and, earlier this week, released an experimental data set that allows for an examination of state-level long-term trends in the change in high-growth firms and establishments across the nation.

Senate advances bill to reauthorize, expand EDA

By a bipartisan vote on Tuesday, the U.S. Senate Committee on Environment and Public Works approved legislation that would reauthorize the Economic Development Administration for the first time since 2004. The bill amends the Public Works and Economic Development Act of 1965 and does not affect the technology-based economic development programs authorized through separate legislation that are administered by EDA.

NACIE recommends a national entrepreneurship competitiveness strategy

The National Advisory Council on Innovation and Entrepreneurship voted today to accept proposed recommendations for a national competitiveness strategy. One recommendation is establishing a National Innovation Council to coordinate entrepreneurship-related federal government activities nationwide. This council would prioritize efforts related to critical technologies through various actions, including “requiring mandatory reporting of demographics of venture capital (VC) investments” and “supporting the development of best practices and standards for evaluating the effectiveness of entrepreneur support programs.”

The defense bill contains fewer provisions related to research, technology, and entrepreneurship than initially proposed

The National Defense Authorization Act for FY 2024, signed in late December, ultimately contained fewer provisions related to research, technology, and entrepreneurship than the draft versions of the legislation initially proposed. Nonetheless, the final bill made some changes that could stabilize some of the department’s innovation activities in recent years and add some flexibility for companies and organizations engaging in technology transfer activities with defense institutions. Specifically, four sections worth noting in the FY 2024 NDAA are the following:

Decoding Scaleup Success: Networks, ESOPs, and Advisors Make the Difference

Startup Genome and the Global Entrepreneurship Network recently released a new report offering a fresh perspective on what it takes for a startup to scale. The report draws on an eleven-year study involving 100,000 startups to provide a nuanced look at the factors contributing to startup scalability, offering actionable insights that underscore the importance of networks for entrepreneur support organizations, entrepreneurs, and policymakers. 

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