A belated linking to stories on NFIB's downtrodden reports on potential hiring at small businesses.  NFIB's tracking of membership intentions is different from the other major surveys they complete, and I've highlighted before, but is generally seen as helpful in the direction, not the levels, that it reports.  Thus when they see falls in likely hiring, that's a concern.  

The Census Bureau's largest survey of young and small businesses, done once every 5 years, is out with new, and close to it's final, data publications using the 2007 Survey of Business Owners.  Check out the following topics on their site today.

Characteristics of Businesses

Data on American FactFinder (by gender, ethnicity, race, and veteran status):

Jointly Owned or Operated by Spouses: (Industry Detail) (Receipts Size) (Employment Size)

Majority of Business Family-Owned: (Industry Detail) (Receipts Size) (Employment Size)

Number of Owners of Business: (Industry Detail) (Receipts Size) (Employment Size)

Year Business Originally Established: (Industry Detail) (Receipts Size) (Employment Size)

Sources of Start-Up or Acquisition Capital: (Industry Detail) (Receipts Size) (Employment Size)

Amount of Start-Up or Acquisition Capital: (Industry Detail) (Receipts Size) (Employment Size)

Home-Based Business: (Industry Detail) (Receipts Size) (Employment Size)

Operated as a Franchise: (Industry Detail) (Receipts Size) (Employment Size)

Owned by a Franchise: (Industry Detail) (Receipts Size) (Employment Size)

Sources of Capital to Expand Business: (Industry Detail) (Receipts Size) (Employment Size)

Type(s) of Customer Categories: (Industry Detail) (Receipts Size) (Employment Size)

Percent of Total Sales Exported: (Industry Detail) (Receipts Size) (Employment Size)

Operations Established Outside United States: (Industry Detail) (Receipts Size) (Employment Size)

Outsourced Business Function Outside United States: (Industry Detail) (Receipts Size) (Employment Size)

Language(s) Used in Transactions: (Industry Detail) (Receipts Size) (Employment Size)

Type(s) of Workers Employed: (Industry Detail) (Receipts Size) (Employment Size)

Employer-Paid Benefits Offered: (Industry Detail) (Receipts Size) (Employment Size)

Company Had a Web Site: (Industry Detail) (Receipts Size) (Employment Size)

E-Commerce as Percentage of Total Sales: (Industry Detail) (Receipts Size) (Employment Size)

Company Made Purchases Online: (Industry Detail) (Receipts Size) (Employment Size)

Seasonal or Part-Time Business Status: (Industry Detail) (Receipts Size) (Employment Size)

Business Operating or Reason Ceased: (Industry Detail) (Receipts Size) (Employment Size)

Press Release

Summary of Findings

Characteristics of Business Owners

Data on American FactFinder (by gender, ethnicity, race, and veteran status):

How Initially Acquired Business

Year Acquired Ownership of Business

Primary Function(s) in Business

Average Hours Per Week Spent Working

This Business Primary Source of Income

Prior Experience Owning a Business

Highest Level of Education Completed

Age of the Owner in 2007

Owner Born in the United States

Service-Disabled Veteran Status

Formal is better; informal the scourge.  While I still remain largely in that camp, I have to say that an article in today's Financial Times gave me some pause on this question.  Growing up in a middle class household in the U.S. Midwest left me with a world view that is intrinsically oriented to the formal economy - or at least I thought.  My grandmother, may she rest in peace, was an amazing woman and indeed the main entrepreneur who I have had in my life and yet I doubt very much that she always reported all of her income.  A highly ethical woman in my estimation, she was widowed with three children (one under 1) at about  the age of 30 and went on to send all of them to college while living independently and only remarrying briefly.  At the age of 88 she was still running her own seasonal business for most of the year and beating me handedly at any game that we engaged before her death.  Just as she probably used a bit of creative accounting to get by at certain times, today's article points out some of the ways in which certain economies are likely surviving currently because of their informal economies.  

I have spent a lot of time in Spain in the recent year which has brought me head long into contact with the informal economy.  Indeed, when first here I have to say I nearly burst a blood vessel trying to deal with some of the things which could only be done in the informal economy which I was used to being formal.  I had some of my most heated arguments and grandstanding trying to deal with people who by all appearances were part of the formal economy but apparently were not.  As the article rightly points out, Spain's informal economy must be among the biggest in the developed world.  And yet, with all of the economic pain and tumult in the Spanish economy, by my reading of currently available data Spain is the hardest hit country anywhere in terms of pre-Crisis and post-Crisis impact on new business formation and the existing small business sector, the Spanish economy is still functioning.  Yes, there have been some significant protests, but as I think the article correctly identifies if Spain didn't have some of this informal economy there is no way that it would not be in a revolutionary state.  (I am not sure it won't reach that state but it's not there currently.)  If the government wants to bring some of this informal economy into the formal economy, which seems necessary for longer-term growth potential, then it needs to face facts about the repressive regimes which remain in place for many formal business and other activities.  That said, in my opinion, Spain has no choice but to live with its informal economy currently as the changes that it needs to make to much of its burdensome regulatory and other regimes will take time and seem deeply, deeply rooted in culture and society. 

Well, that is all a bit of an aside probably for most of my readers.  I offer it only in the way of saying, this topic of informal economy measurement is extremely important.  Many of the data projects we have funded only focus on the formal economy because high-growth companies need to be operating formally (OECD and World Bank), but I am sure that this set of measurement issues is important and indeed will likely be incorporated by many scholars as a measure of institutions in different countries.  The Financial Times article is data driven, offering estimates from Friedrich Schneider that appear to be the going standard in this area, but it also has a nice discussion of the dangers of measuring the informal economy over time.  I would expect that we will see a lot more measurements of the informal economy as the markers of business and household activity (all the data we are leaving in our daily activities) explode in the coming years; it is these data or things like electrical consumption that seem most common bases for estimating the actual business activity in a country.  Those interested in this area should check out the article or the longer journal article which I have been told by experts at the World Bank is where they currently draw from:

Schneider, F. and D. Enste, 2009. Shadow economies: Size, causes and consequences. Journal of Economic Literature, 38(1): 77-114.

Here is a sneak peak at some of the data the Financial Times presents:

I just came across a blog from the Guardian, DataBlog, which could give way to hours or days of exploration - if only I had that luxury.  Perhaps my only complaint is that DataBlog seems to be covering everything and in every direction.  They have a database of databases that cuts across countries and topics from business registrations to abortion.  But as such, it's ironic that I'd find out about a major U.S. database on a U.K.-based site but that's just how the world works these days.  

The new database is from the Federal Emergency Management Association (FEMA) and provides state-level details about every declared emergency since 1953 in the United States by type of emergency (tornado, flood, etc.).  If you were wondering, Texas looks to hold the title of most declared emergencies in that time period at 3,293 - mostly hurricane related.  I can only imagine that this data will lead to finer-grained forthcoming data about these emergencies at a more local level or more metadata about the emergencies at the state level.  

So what does this have to do with entrepreneurship and innovation?  Well, it's probably more of interest to entrepreneurship scholars but from my perspective there remains opportunity to tell the story of how businesses rebuild, new businesses come in, and the general business dynamics recover after natural disasters.  The existing FEMA data looks to lend itself well to potential marriage with other data now available tracking cohorts of businesses over time at the state level that are available from the Census Bureau and Bureau of Labor Statistics.  Indeed, in my opinion, we are going to be seeing a lot of research looking at state-level impacts on entrepreneurship in the coming years.  I know I've reviewed two such papers this month, both of very good quality that make use of the confidential Kauffman Firm Survey data file.

Two additional concluding thoughts:

1. I'm introducing a new tag - state - in my tag cloud to start tracking state-level data sources which I come across.
2. On the very important topic of what we know about entrepreneurship and natural disasters, if you've got research or data in this area, please let me know as we get a lot of media requests on this topic, and it'd be great to be able to point to some quality academic work in this area.  

 

The Bureau of Labor Statistics continues to improve their presentation of information relevant to the study of entrepreneurship.  "Entrepreneurship and the U.S. Economy" is a must read for policy-makers as it presents some very important aggregate trends in an up-to-date and simple to understand way.  That said, just once caution, as I am currently writing and researching using these data.  Some of the jobs trends seen in the BLS statistics and Census Bureau statistics are quite different and need to be looked at together.

A particular chart that stood out to me in BLS's publication is the following which really charts how the most recent recession most significantly impacted large and small businesses and medium-sized businesses weathered somewhat better: