8/12/2009 11:18:21 AM By
E.J. Reedy
Back in July the Organization for Economic Co-operation and Development (OECD) and the U.S. Census Bureau hosted a two day seminar on turning statistics into knowledge. The PowerPoints and speakers from the event are now available online for those wanting to explore data visualization or other aspects of making knowledge more approachable.
8/11/2009 10:28:06 AM By
E.J. Reedy
Alicia Robb, Denny Dennis, and I did a Professional Development Workshop at the Academy of Management a couple of days ago. Here I am posting the slides from that workshop, which focused on data available for entrepreneurship research, along with notes from my comments at the event, which I had not put into slides.
Alicia Robb, Kauffman Foundation and University of California, Santa Cruz
Denny Dennis, NFIB
E.J. Reedy, Kauffman Foundation
Additionally, at the meeting, hard copies of the proceedings of the 2007 Kauffman Symposium on Entrepreneurship and Innovation Data were handed out. Additional copies were requested by some but electronic versions of each paper are available on line. The 2008 proceedings, which focused on ideas for improving data are also available.
And lastly, we highlighted a few ways in which scholars could connect with Kauffman and other scholars in this area. There is this blog, Data Maven, for tracking data developments. On Facebook, join the Kauffman Entrepreneurship Scholars group. Subscribe to entrepreneurship emails from Social Science Research Network. Or participate in Kauffman's emerging scholars programs.
8/4/2009 12:39:24 PM By
E.J. Reedy
Each year, the Office of Advocacy at the Small Business Administration helps to support the tabulation of Census Bureau data by firm size under the title " Statistics of U.S. Businesses and Nonemployer Statistics" or more typically SUSB. While a couple of years dated, these statistics still come in handy quite often. From their 2006 update email...
The Census Bureau has released 2005-2006 updates to the Statistics of U.S. Businesses, produced with partial funding from the Office of Advocacy. The newly added data include business openings/closings and job creation/destruction by industry and geographic location. One new component of this release is establishment births and closures by county. Some these data series go back as far as 1989, allowing users to see how small businesses are affected by the business cycle. See the dynamic data sections of http://www.sba.gov/advo/research/data.html for details.
7/23/2009 9:42:12 AM By
E.J. Reedy
One of the first questions when doing a national business survey is the question of what businesses to use as the population for the survey. This is one which many organizations, like ourselves, struggle with in an ongoing basis. While we are a private organization, and as such, could not hope of getting the "gold standard" of frames, a government business register, even with the United States government and within the European Union directorates, few agencies are able to access Census, Bureau of Labor Statistics, or Internal Revenue Service pr similar business lists for the purposes of carrying out surveys. As such, federal agencies and private organizations like Kauffman are forced to go down a different route to obtain business lists which can, if not carefully considered, impact the overall quality of the research. But beyond this, an additional cost is born by taxpayers, businesses, and others more generally, because when using a non-governmental register of businesses, it becomes much more complicated to match survey responses to other administrative data. With this, we end up with a lot of independent surveys, few of which can actually be matched together, causing the surveys to be longer than really necessary and knowledge gained about different issues to be stymied. There are a host of privacy issues here which I am not going to address, but anyone seriously concerned with this topic should look at that topic separately.
Private organizations have popped up to provide these lists, some that are specific to different industries, such as Corptech, which claims to cover high-tech businesses, while others like Dunn and Bradstreet or InfoUSA report to provide full industry coverage on the national level with international coverages that are very country-specific. And even companies like Dunn and Bradstreet allow others to repackage and sell their data, such as what Don Walls does with the NETS database.
But how do these different lists compare to federal government lists? Private companies provide the data in a much quicker fashion and I would say the general consensus is that this benefit is offset by more messiness in the data. While some messiness is involved in any data set, as researchers are increasingly using micro data sets and not just aggregated tabulations, non-random messiness can become a problem. Many of these companies didn't start collecting this data for research purposes but more for marketing or credit checks. As the Internet has blown up, and companies have come to realize the value in some of this data, more products have appeared over time. Some work was done in the 1990s by entrepreneurship scholars to test the coverage of the private sources, but the reality is that not much has been done, to my knowledge, in at least ten years looking at a systematic comparison of advantages and disadvantages of some of these business registers. From conversations with others about the NETS database, as an example, we know that the last ten years have brought about a lot of changes in the population of businesses these private companies are able to find and include in their registers. This can create new opportunities but also real challenges for researchers looking to use the longitudinal component of these data.
I am aware of at least two projects that are underway in this arena that might be able to provide insights into some of the different private business registers (as well as governmental business registers). The first, and it appears furthest along of the projects, is comparing Census data to InfoUSA. I will be attending the 2009 Joint Statistical Meetings (JSM) in Washington, DC, in August and hope to attend the session at which this comparison will be presented. The second project which I have heard alluded to several times is that Census is matching the California file of businesses from NETS to its business register to study similarities and differences. Both of these efforts should be informative to researchers and I will try to follow-up with additional details of the outcomes of this research in future posts. At the JSM, other register issues will be discussed including some international examples such as that of Finland. Nordic countries, by most accounts, have the most robust registers so that might be an interesting section. If other projects are underway that are comparing private and governmental registers, I would appreciate an email.
7/10/2009 5:33:00 AM By
E.J. Reedy
What is the home to the entrepreneur? For many entrepreneurs, a home is more than where the heart is. It's where they operate their business or they at least have a home office. And for many the home is also a source of financial leverage as collateral on a loan or through something like a home equity line of credit.
I just ran across a recent Federal Reserve event I wish I had seen before it happened because it would have been nice to raise the importance of housing to entrepreneurship and need for better data: Understanding the Housing and Mortgage Markets: What Data Do We Have? What Data Do We Need? I haven't been able to locate any additional papers or documentation from the event yet but just the list of people looking at housing data issues is helpful. But this does cause us to pause and take stock of what data we are available of on entrepreneurs and how they utilize their homes?
From the National Federation of Independent Businesses (NFIB), we have a whole survey on the topic of Business Activity in the Home. A couple of highlights:
- About one in four (22%) employing businesses is principally located in the home or an associated structure and another 25 percent have a home office in their residence.
- Home-based businesses overwhelmingly employ fewer than 10 people. The principal location for 27 percent of businesses employing fewer than 10 is the home compared to 4 percent for those employing 20 or more.
Also from NFIB, which looks as small business owners, under 250 employees, we have some interesting leads on ownership of personal residence as well as mortgages taken out to promote business activities:
- Small business owners are heavily invested in real estate. Ninety-six (96) percent own their personal residence, 49 percent own all or part of the building and/or land on which their business sits (excluding the one-quarter who operate primarily from the home), and 41 percent own investment real estate, excluding their residence and business.
- Real estate, particularly home mortgages, is frequently used to finance or collateralize other business assets. Seventy-six (76) percent have at least one mortgage on the real estate they own with 13 percent having three or more mortgages, 22 percent having taken out at least one mortgage to finance business activities. Sixteen (16) percent use real estate to collateralize other business assets, including 10 percent who use their homes as collateral. About one in 10 (9%) own at least one currently upside-down property. The financial leverage homes provide businesses in a weak economy with declining real estate values is a matter of concern.
We know from the Kauffman Firm Survey, which examines new businesses in the United States, that "Nearly half of businesses started in the business
owner’s home or garage. Slightly more than 40 percent operated in rented or leased space, while the remainder operated at the site of a current client, or in a building or location bought by the business."
The Census Bureau's Survey of Business Owners gives us other insights, which seem to reinforce NFIB's survey, including that twenty-two percent of employer firms are home-based and fifty-eight percent of non-employer firms are home-based. They also have many industry breakdowns and other breakdowns by veteran or other demographic statuses.
Are you aware of other data on housing and entrepreneurship? Let us know. I am aware of at least two or three in-prcess research projects which are trying to statistically equate housing market changes with changes in entrepreneurship but to the extent I am aware of what the researchers plan, all of these projects are not using microdata.
5/2/2009 9:03:00 AM By
E.J. Reedy
Someone is doing some really progressive work with the Economic Census at the U.S. Census Bureau. They continue to make solid improvements in their presentation of information to respondents as well as now for researchers and others in combing through the mounds of materials they produce. I am hopeful that they will continue this trend by making more of this data searchable in upcoming interfaces, but...
For now, I wanted to highlight that the main Survey of Business Owners website (part of the Economic Census) has been overhauled and is worth a look. While there are a lot of great reports here, two of the most helpful are towards the bottom of the page: Company Summary and Characteristics of Businesses. Many of the questions we get from reporters and local officials center on questions answered in these documents like how are minority-owned firms fairing? How are start-ups funded? (although I take some issue with this data because of its strong survivor and recall biases) and what are the receipts of businesses by race and gender of the business owner?
The second new feature of the Economic Census is the ability to sign-up for industry-specific nofications. NotifyMe is a pretty simple service to use and allows for a great deal of granularity in the industry classifications one subscribes to, but that's also probably my only critique of the service. The North American Industry Classication System (NAICS) is sufficiently complex even for researchers (let alone many entrepreneurs and the general public) that offering a web-based system which requires check boxes for each NAICS category is cumbersome. It might be nice in the future if they offered a means of searching the titles of these industries. This might also provide a means by which Census could look for emerging industries or how to improve their list as search data can provide a real insight into what users are looking for. Even with that criticism, I think this service will be useful for entrepreneurs who want real-time, really-specific information.
4/3/2009 9:37:00 AM By
E.J. Reedy
The Census Bureau released several thousand new tables on business dynamics a couple of months ago which are just now starting to be picked up by the research community for scholarship. In particular, I was impressed by a recent paper on the cyclicality of employers. It's worth a read for everyone wanting to understand how different types of businesses are likely to be impacted by the recession.
3/31/2009 11:02:00 AM By
E.J. Reedy
Family-ownership of firms isn't something that we deal with a lot at Kauffman, but it's something that the larger field considers a part of entrepreneurship. As such, when I got an email inquiry today through our website on the subject and data available on family-owned firms, I decided to take a look. I didn't go far because for this type of thing, in the United States, there is really only one great source, the Survey of Business Owners. It's done every five years in conjunction with the Economic Census. The most recent released data is from 2002. And what I found really fascinated me:
Respondent firms 16,687,541 total - 4,091,884 employer firms; 12,595,657 non-employer firms
- Family-owned, yes: 23.4 percent overall – 28.1 percent for employer firms; 21.9 percent for non-employers
- Family-owned, no: 9.4 percent overall– 18.3 percent for employer firms; 6.5 percent for non-employers
- Family-owned, only one owner: 63.6 percent overall - 51.0 percent for employer firms; 67.7 percent for non-employers
- Family-owned, item not reported: 4.2 percent overall - 4.1 percent for employer firms; 4.2 percent for non-employers
Source: Table 4. http://www.census.gov/prod/ec02/sb0200cscb.pdf
I'm still getting used to tables, etc. on the blog so apologies for the clunkiness here, but the basic message I wanted to show was that it's really interesting that a majority of firms in the United States are single-owner firms and yet these firms predominantly respond that they are "family-owned". By my reading of the above, 87 percent of firms responded that they were family-owned. Even close to 80 percent of employer firms reported being family-owned.
3/25/2009 6:12:00 AM By
E.J. Reedy
The Association of Public Data Users (APDU) is hosting an online presentation on “The 2010 Census: Preparations for a Complete Count” on Tuesday April 14th, 2009, 2:00 pm - 3:00 pm EDT. Daniel Weinberg, Assistant Director for American Community Survey and Decennial Census, U.S. Census Bureau, will be presenting. Registration is necessary. Contact Denise M. Bosmans.
While the decennial census doesn't have a lot of direct application to entrepreneurship or innovation, it relates to so many things in the statistical infrastructure it is important to be aware of.
3/5/2009 10:25:00 AM By
E.J. Reedy
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Developing better data is part of Kauffman's long-term strategy for advancing better research and policy on entrepreneurship and innovation. Data Maven is place you can connect with new data developments, provide us feedback on possible new projects, and contribute to the community seeking to improve entrepreneurship and innovation measurement.
E.J. Reedy is a manager in Research and Policy at the Kauffman Foundation. Learn more ...
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