Entrepreneurship is on the rise, with more people starting businesses now than ever before. The U.S. Census Bureau recently reported a record 5.5 million applications to start businesses in 2023, up half a million from the previous year.
Even in the first four months of 2024, the startup boom continues with over 1.7 million new business applications. But why are so many people choosing to become entrepreneurs?
Columbia Business School professor Angela Lee believes that the “unprecedented number of layoffs from big tech companies in the last several years” has contributed to this trend, creating a large pool of talent ready to pursue entrepreneurship.
Historically, entrepreneurship tends to thrive during recessions as the opportunity cost of starting a company decreases. This shift is further supported by the record number of tech layoffs in recent years, with companies like Amazon, Meta, Google, and Microsoft letting go of tens of thousands of employees.
While the unemployment rate has remained stable, job seekers are increasingly turning to entrepreneurship as a viable career option. The current economic landscape is creating a fertile ground for innovation and growth, driving more individuals to take the leap into business ownership.