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Kauffman Foundation Study Finds that Some New Firms Will Be Created and Thrive in Economically Challenging Times

According to a new study by the Ewing Marion Kauffman Foundation, challenging economic times can serve as the rebirth of entrepreneurial capitalism, leading to the creation of much-needed new jobs. The study, “The Economic Future Just Happened,” finds that more than half of the companies on the 2009 Fortune 500 list were launched during a recession or bear market, along with nearly half of the firms on the 2008 Inc. list of America’s fastest-growing companies.
The study points out that while recessions often create widespread economic grief, they also can encourage potential entrepreneurs, acting “as an extra spur to founding a new company, if the founders perceive their prospective competition might be weakened.” Rising unemployment can benefit new enterprises: entrepreneurs may view unemployment as an opportunity to start a company, and seize the advantage provided by the ability to tap into a larger pool of potential employees. To access a press release about the study, click here. To access a copy of the complete study, click here.
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