New Results: Microbusinesses Drive Job Creation, Reduce Unemployment
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NORTHAMPTON, MA / ACCESSWIRE / April 11, 2024 / GoDaddy
As originally published by GoDaddy's Venture Forward Research Initiative
Since 2020, GoDaddy Venture Forward findings have consistently proven that microbusiness entrepreneurship makes an outsized impact on the economy, promoting job creation, boosting annual household median income growth and driving down unemployment. Every year, when the U.S. Census releases its most recent data, GoDaddy Venture Forward runs new analyses to capture the latest economic impacts.
Venture Forward is a research initiative that GoDaddy launched in 2018 to quantify the presence and impact of online microbusinesses on their local economies, providing a unique view into the attitudes, demographics and needs of these entrepreneurs.
This year, in partnership with UCLA Anderson Forecast economists led by William Yu, we've uncovered the following impacts made by microbusinesses (those having 10 or fewer employees, a domain and an active website).
- At the county-level, every additional microbusiness entrepreneur adds about seven jobs, which has continued to grow based on data through 2023.
- Analysis of data from 2018 to 2022 found the effect of microbusiness entrepreneurship to be two or more new jobs for every additional entrepreneur, and from 2020 to 2022, about six new jobs.
- Adding 1,000 new microbusiness entrepreneurs in a county is associated with a drop of 0.11 percentage points in the unemployment rate.
- This means that studying Miami-Dade County in Florida, with almost 430,000 microbusinesses and 2.1 million people over the age of 18, adding just 1,000 entrepreneurs would reduce the region's unemployment rate by almost
7% (from1.6% to1.49% ).
Our research shows that entrepreneurship has only continued to grow in importance - from acting as a backstop during economic downturns like the pandemic, to being a catalyst for greater prosperity in current times, and the historically low unemployment rates we're experiencing.
"We've learned that online businesses with 10 or fewer employees are creating more jobs than before - up to seven jobs for every one entrepreneur, compared to only two just a few years ago," said Alexandra Rosen, senior director of Venture Forward. "Our findings show how even the smallest of businesses can significantly drive down unemployment rates in communities across the country."
For more information about the state of microbusinesses across the country, visit the Venture Forward Microbusiness Data Hub.
About GoDaddy Venture Forward
GoDaddy's Venture Forward research initiative analyzes more than 20 million online businesses with a digital presence (measured by a unique domain and an active website). Most of these businesses employ fewer than ten people, categorizing each as a microbusiness. While these microbusinesses may be small, their impact on economies is outsized even though they are often too informal or too new to show up in traditional government statistics.
Since 2018, Venture Forward surveyed more than 36,000 small business owners with a digital presence, making it the source for microbusiness data and insights.
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SOURCE: GoDaddy
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