3 Things You Should Know About Small Business: Nov. 28
NEW YORK (TheStreet) -- What's happening in small business today?
1. Startups lead recovery in hiring and job creation. The pace of recovery in hiring and job creation since 2008 is stronger in newer firms -- those two years old or younger -- than in more established companies, according to the "Job Creation, Worker Churning, and Wages at Young Businesses" report released Wednesday by the Ewing Marion Kauffman Foundation.
Despite higher employee turnover rates, the share of hiring based on job creation is much greater at startups than at more mature firms. According to the report, four out of every 10 hires at young firms are for newly created jobs, much higher than at older firms, where the ratio fluctuates between 2.5 and 3.3 hires.
The research draws its conclusions from the U.S. Census Bureau's Quarterly Workforce Indicators, which use federal and state administrative data on employers and employees combined with core Census Bureau data. The Census report recently began including firm age and size information, making it possible for the first time to review jobs, earnings and employment turnover using that criteria, and to make regional and demographic comparisons, Kauffman explains.
The Kauffman report also found that, not surprisingly, earnings per worker are lower at young firms than at more mature firms. Just before the 2001 recession, startup employees earned about 85% as much as workers at mature firms. By 2011, this earnings ratio had dropped to 70%, the report says.
2. Six reasons you should relocate your startup. Selecting an appropriate location for your business is just as important as the product or service you are selling. Depending on your industry, there are regions in the U.S. and internationally that might be better suited for your business.
"For example, consumer-focused Internet start-ups thrive in Silicon Valley, Boston's best for biotech and big data, and for media- and fashion-focused ventures, Manhattan's the biggest apple," Forbes contributor Peter Cohan writes.