3/16/2010 3:00:00 PM By
A WSJ article from Tuesday
got me thinking about career satisfaction. I am intentionally leaving off the term "job" here as I think it biases the concept to people who work for others, although that is purely speculative and not based on cognitive interviewing. The article was referencing a Conference Board
survey that has been done historically and was fielded again in 2009 asking 5,000 U.S. households about their job satisfaction. The trends are clearly headed in the wrong direction:
Since we know that the proportion of people in the U.S. that are working for themselves as small business owners or in some form of self-employment hasn't changed that much over this period, I find it puzzling that decreasing levels of job satisfaction aren't leading to more business starts. In my mind, and I think in many conceptualizations of entrepreneurship, the entrepreneur is the dissatisfied employee who also sees an opportunity and eventually decides to strike out on their own.
It is interesting to put the Conference Board research next to a similar question asked of population of small business owners courtesy of the NFIB
It is amazing to me that the NFIB had only twelve percent of their sample reporting a satisfaction level of 5 or below. This particular survey was completed in 2001 so there might be macroeconomic effects here but doubtful they'd be of a magnitude large enough to make a difference.
So, this is a post without much of a conclusion. Job satisfaction is down...new business starts are steady...small business owners overwhelmingly satisfied...what's keeping this system so out of equilibrium? I would conjecture that perhaps there is a possible measure of job lock
somewhere in all of this but I don't know exactly what it would be.
Related post: Gallup Finds Business Owners Happiest
3/12/2010 9:00:00 AM By
The WSJ has a new listing out of "promising" young firms
that might be of interest to readers. This list is a classic example of why people default to using venture capital data frames: 1) venture capital is perceived as a good proxy for "innovativeness" and "high-potential" and 2) the data can be disclosed with actual business names. But I'd caution readers to remember that venture capital funding is historically coast-centric and that while venture capital data is often a helpful starting point for considering innovation young firms, it is not often an ending point. The majority of young, high-potential firms in the country will exist for years before receiving venture capital backing (if that ever occurs).
3/11/2010 9:00:00 AM By
3/10/2010 3:00:00 PM By
Intrapreneurship, or the process of an individual (or team) starting a business (or business line) for an existing employer, is a concept not often measured within existing entrepreneurship metrics. This makes sense since it is more difficult for government statisticians to capture intra-firm dynamics in a meaningful way, industrial organization scholars are more focused on the behavior of the firm (not the entrepreneurs running them or employees of), and entrepreneurship scholars, for the large part, are focused on owner-operator firms with little systematic tracking of other key employee actions.
All of this makes noteworthy a recent report out from the Global Entrepreneurship Monitor team of scholars looking at the topic of intrapreneurship. Intrapreneurship is a concept that GEM has measured for some time in their screener at the national level but this new effort to conceptualize and inquire at the household level in Brazil, Chile, Ecuador, Iran, Republic of Korea, Latvia, the Netherlands, Norway, Peru, Spain, and Uruguay stands out for going into greater depth than previous work. Specifically, the scholars have screened for intrapreneurship using the following logic process.
If each implementing national team has implemented these concepts with strict adherence to protocol and is working with a quality survey vendor, then I think this was a really helpful exercise. First, the questions and logic are simple and straight forward. Second, capturing intrapreneurship should be a strength of household survey frames, which GEM uses. And, lastly, the scholars attempt to differentiate across different levels of intrapreneurship, although there are still broader conceptions of intrapreneurship that have been employed by others.
The authors come to the conclusion that "on average, less than 5 percent of employees are intrapreneurs, and that in most countries its incidence in the adult population is significantly lower than that of early-stage entrepreneurial activity," but probably more importantly to me is their finding that "the prevalence of intrapreneurship is about twice as high in high income countries as in low income countries." This makes a lot of sense since higher-income countries tend to have larger business organizations and thus the likelihood that a working age individual is employed at large business organization increases as countries develop. But on a related topic, I am puzzled by their finding that the prevalence of intrapreneurs increases with the size of the business.
If this is an unweighted measure, as I think is the case, then I worry this will lead to the conclusion that employees at smaller companies are less "intrapreneurial" but in fact, I suspect that if you weighted this so that it was on a per employee basis then the resulting outcome would be much more balanced.
Additionally, I wanted to point out the similarities of some concepts being measured here and those which are measured in other survey frameworks looking at innovation. Specifically, this survey protocol and the Oslo Manual
, which the Organisation for Economic Co-operation and Development (OECD) uses to measure innovation at the firm level, both appear to look at whether the new business activity involves a new product or service. There is a lot of potential overlap in concepts between entrepreneurship and innovation so this isn't surprising but should be noted.
Read the full report, Intrapreneurship - an international study
3/10/2010 1:00:00 PM By
This year the Census Bureau finally received full funding of their plan to expand coverage of the service sector. On Friday, March 12, the Brookings Institution will host a workshop
that will examine this expanded service sector work. I won't be there but this is without a doubt among the most important improvements underway to our timely measurement of the economy.
3/10/2010 9:00:00 AM By
My colleague, Dane Stangler, has a new report out today in Kauffman's series looking at business dynamics. Today's report, High Growth Firms and the Future of the American Economy
, is a really easy and compelling read highlighting the importance of considering new and young firms as the United States works to advance job growth. Anyone who read Dane's piece from last fall, Where Will the Jobs Come From
, will enjoy this addition as well.
What I like best about Dane's new report is that it doesn't gloss over really complicated topics like change and the nature of competition between entering businesses and established businesses. It also provides good statistics on the nature of growing businesses in 2007 such as:
- "Gazelle" firms (ages three to five years old and fast growing) comprise less than 1 percent of all companies, yet generate roughly 10 percent of new jobs in any given year.
- The "average" firm in the top 1 percent of the growth distribution contributes 88 jobs per year. The average firm in the economy as a whole, on the other hand, adds two or three net new jobs each year.
The report goes on to offer a series of policy recommendations for officials working to promote this population of businesses.
3/9/2010 7:00:00 PM By
The National Federation of Independent Businesses (NFIB)'s Index of Small Business Optimism is out for February 2010 and showed a small drop in optimism among business owners. Even more depressing than a one-month lull is the fact that the index has remained below a level of 90 for its longest period ever. Read more from the Wall Street Journal or on the NFIB website.
3/9/2010 12:00:00 PM By
The last couple of months haven't been good for me and blogging. It was much harder than I anticipated to get time to blog while on leave to take care of my new daughter, Dorothy, whom we adopted in late November. But, as you can see from her photo, the time off with Dorothy was well worth it!
In many ways, taking a break from blogging was a good thing for me. It gave me some time to reflect on a year of blogging on the topic of entrepreneurship and innovation data. The topic still elicits great intellectual passion for me and as such I will be ramping my blogging back up. Indeed, if there is anything I have seen in the last year of economic tumult and policy crisis it is that it is there can be great returns to a continual focus on a particular topic, even as others interest ebbs and flows. We were lucky that our focus on ramping up entrepreneurship measures at Kauffman started back in 2002 and that many of the efforts were implemented before the crisis started, such as the Kauffman Firm Survey
and the Organsation for Economic Co-operation and Developments indicators
. It will be very hard for many statistical groups to implement new series until the pace of economic change has flattened out and baselines can be established. Some of our less well-known programs, such as support for the work of Andy Reamer at the Brookings Institutions on bringing the U.S. statistical system into the 21st century, recognized more systematic problems with economic measurement - a topic which has become too apparent to everyone searching for answers in the current environment.
But I regret that I haven't been able to find ways to better network some of the people involved in this data work. The Kauffman Symposiums on Entrepreneurship and Innovation Data were a powerful series of events with this purpose and we still plan to reinstate them in some form later this year; however, finding ways to engage these tireless and humble soldiers of statistics and survey methodology on line is still a struggle. While Data Maven has helped me to broadcast some of my thoughts, it has been harder to get a good feedback loop going than I'd hoped. Additionally, in the coming months I want to get back to the unique focus of this blog a bit more. I will continue to highlight interesting new data, surveys, and other methodological issues but I won't be posting as many of what I was calling "opportunities" which included calls for papers and funding. I will strive to get back to a more timely pace of updating Data Maven and work to find ways to serve as a community resource as well as a unique voice in this space. I continue to be open to suggestions for improvement on Data Maven or other people who might be interested in blogging on this topic.
So, to the Data Maven readers out there, I say "thank you" for a good year, "hello again" after a short pause, and "you are invited" to join the cause of improving entrepreneurship and innovation data.
1/22/2010 3:00:00 PM By
For some time I have stayed away from venture capital data. It is very popular territory for academics to research in as it is data rich (or at least data are readily purchasable, if very expensive); often includes actual company names that can be used in research through matching, surveys, or other web scraping; and VCs are just sexy (at least within the range of topics studied within entrepreneurship). Personally, I have chosen not to focus on VC data since it seemed just about everyone else was. My comparative advantage was to study the more boring topics like financing patterns in non-VC companies, angel capital, and just about any other topic. But I've avoided educating myself for too long, so please help me.
But VC data, although arguably the most developed in the entrepreneurship space, is so messy and debatable. Take for example this posting by Brad Feld
which points out many errors he is aware of in the published PWC Moneytree data. Now, Brad wasn't really concerned here with the accuracy of the underlying data but was pointing out that the data is really difficult to use in looking at start-up funding. Most VCs actually fund companies which the academic community would consider beyond start-up phase.
So, I don't have a lot more to say right now on this, but I wanted to throw this out there in the hopes of getting some comments on the different VC databases, as well as their perceived strengths and weaknesses. I know the basics on the data here but I am really hoping that readers will provide some education. Many thanks in advance.
1/21/2010 2:24:37 PM By
To follow up on November’s post on green jobs, I attended another webinar hosted by the LMI in the Green Jobs series. The title was: Managing a Green Jobs Survey. Researchers from Washington and Oregon (Greg Weeks and Charlie Johnson, respectively) who completed green jobs surveys in their states presented results and gave pointers to future surveyors on green jobs survey design and collection.
The presentations broke into two parts: results and advice.
The two surveys have different definitions and different methods, but general trends can be seen in both surveys.
- Of all the industries that contain green jobs, the construction industry has added the most green jobs out of any other. These construction jobs are those that are either geared to energy efficiency or are related to renewable energy.
- Green jobs have a higher than average wage, and many green jobs don’t require a bachelor’s degree. However, the highest paying green jobs do require higher education.
- Individual occupations are becoming green, but the often-talked-about green industry is generally non-existent. Most green jobs today are old jobs with a green focus. Few are brand-new, and just about all of them retain the same title as before (exceptions are those like wind turbine technician). Both researchers refer to this as the “greening” of the economy.
There was a lot of advice given on how to run a survey and how the researchers might have run their own surveys differently. Major points break down as follows:
- The Bureau of Labor statistics has not issued a standard definition of a “green job” yet, but there are already a lot of guidelines out there (both from surveys like these and other sources). If a researcher were to develop his/her own definition, a good jumping off point would be to examine a paper put together by the Workforce Information Council which can be found here.
- As stated above, there is no specific green area of the economy; all parts of the economy are experiencing “greening” to some extent. Therefore, in future studies, individual jobs must be the unit of analysis. Aggregating to the firm level (or even across occupations with the same title) will tend to bias results.
- Response rates of surveys mailed to firms (who then tally green occupations) are typically low. Both surveys had response rates of about half. Therefore, when conducting future surveys, substantial follow-up efforts are necessary to try to minimize non-response bias.
- Other ways to increase the response rate are to:
o Design simple and easy-to-complete surveys.
o Provide example answers.
o Make the survey available to complete online.
The Washington report can be found here with addendum here.
The Oregon report is here.