Where the Jobs Are: Entrepreneurship and the Soul of the American Economy

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9781118573242: Where the Jobs Are: Entrepreneurship and the Soul of the American Economy

A guide to ending America's jobs emergency by accelerating the true engine of job creation—start-ups

Four years after the end of the Great Recession, 23 million Americans remain unemployed, underemployed, or have left the workforce discouraged. Even worse, Washington policymakers seem out of ideas.

Where the Jobs Are: Entrepreneurship and the Soul of the American Economy shows how America can restore its great job-creation machine.

Recent research has demonstrated that virtually all net new job creation in the United States over the past thirty years has come from businesses less than a year old—true "start-ups." Start-up businesses create an average of three million new jobs each year, while existing businesses of any size or age shed a net average of about one million jobs annually.

Unfortunately, the vital signs of America's job-creating entrepreneurial economy are flashing red alert. After remaining remarkably consistent for decades, the rate of new business formation has declined significant in recent years, and the number of new jobs created by new firms is also falling.

In Where the Jobs Are, the authors recount the findings of a remarkable summer they spent traveling the country to meet and conduct roundtables with entrepreneurs in a dozen cities. More than 200 entrepreneurs participated—explaining in specific and vividly personal terms the issues, frustrations, and obstacles that are undermining their efforts to launch new businesses, expand existing young firms, and create jobs. Those obstacles include a dangerously underperforming education system, self-defeating immigration policies that thwart the attraction and retention of the world's best talent, access to capital difficulties, a mounting regulatory burden, unnecessary tax complexity, and severe Washington-produced economic uncertainty.

  • Explains how start-ups are different from existing businesses, large or small, and why they represent the engine of job creation
  • Reveals how policymakers' failure to understand the unique nature and needs of start-ups has undermined efforts to stimulate the economy following the Great Recession
  • Presents a detailed, innovative, and uniquely credible 30-point policy agenda based on what America's job creators said they urgently need

Engaging and informative, Where the Jobs Are reveals with unprecedented precision and clarity the major obstacles undermining the fragile economic recovery, and provides a vitally important game plan to unleash the job-creating capacity of the entrepreneurial economy and put a beleaguered nation back to work.

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From the Inside Flap:

During the Great Recession of 2008-2009 and the difficult year that followed, nearly 9 million American jobs were eliminated. The damage to U.S. labor markets was the most extensive, in both absolute and percentage terms, since the Great Depression, destroying all employment growth over the prior decade. Just as alarming—and in stark contrast to the historical pattern of deep recessions being followed by sharp rebounds—more than four years into the recovery, economic growth remains stalled and 24 million working-age Americans remain jobless, underemployed, or have left the workforce discouraged.

Perhaps most worrying, Washington seems out of ideas. Having done what history teaches must be done, policymakers now seem at a loss for what to do next.

With the hope of generating new policy alternatives, co-authors John Dearie and Courtney Geduldig launched an effort in April of 2011 to understand the nature and scope of the damage to U.S. labor markets and, if possible, identify new ways to enhance the economy's job-creating capacity. Shortly after they began their investigation, they learned of research that demonstrates how virtually all net new job creation in the United States over the past 30 years has come from businesses less than a year old—true "start-ups."

Stunned, they realized that Washington policymakers too often overlook and neglect the economy's true engine of job creation—new businesses. Investigating further, they also learned that America's job creation machine is faltering, with the rate of start-up formation declining precipitously in recent years.

To find out why, they launched an ambitious summer road trip—conducting roundtables with entrepreneurs in 12 cities across the nation. More than 200 entrepreneurs participated in these roundtables, explaining in specific terms the obstacles that are undermining their efforts to launch new businesses, expand existing young firms, and create jobs. Dearie and Geduldig came away from their summer journey struck most of all by the nation's stunning entrepreneurial dynamism. Another major takeaway—which is enormously significant from the standpoint of potential policy solutions—is that entrepreneurs from Austin to Boston and from Seattle to Orlando face the same burdens, frustrations, and difficulties.

The summer on the road with American entrepreneurs made several critical realities vividly clear: First, young businesses are extremely fragile, and yet, those new businesses that survive tend to grow and create jobs at very rapid rates. Second, the policy needs and priorities of new businesses are unique. Policies intended to enhance the circumstances of large corporations or even existing small businesses—however well intended—often miss the needs of new businesses. Third, policy help for America's job creators is urgently needed. Given the critical role they play in our nation's economy, America's young businesses need a comprehensive and preferential policy framework designed to cultivate and nurture start-ups.

Fortunately, Dearie and Geduldig now know what needs to be done. Meeting and listening to America's entrepreneurs revealed with unprecedented clarity and precision the major obstacles undermining their ability to launch new businesses, grow those businesses, and create new American jobs. In Where the Jobs Are, they present 30 specific policy proposals based on what the nation's job creators told them they need. The resulting policy agenda amounts to an altogether new, uniquely credible, and vitally important game plan for unleashing the job creating capacity of America's powerful entrepreneurial economy and putting a beleaguered nation back to work.

From the Back Cover:

Praise for Where the Jobs Are

"As a former entrepreneur myself, and having witnessed firsthand as Commerce Secretary just how competitive the global economy has become, I can attest that Where the Jobs Are delivers a message that is both uniquely credible and critically important. Dearie and Geduldig traveled the nation, meeting and talking with hundreds of American entrepreneurs, to convey the unvarnished and vividly personal insights and observations of America's job creators. It is a fascinating narrative about the ambitions, frustrations, and challenges that all entrepreneurs must face. The authors also outline a detailed agenda of specific policy proposals based on what the nation's entrepreneurs say they need to succeed. Anyone interested in a thriving American economy that competes globally, grows, and creates jobs and wealth for American workers and families should read and absorb the messages, ideas, and policy proposals in Where the Jobs Are. Nothing less than our nation's economic future is at stake."
—DONALD L. EVANS, former United States Secretary of Commerce

"This book is a masterful achievement in labor economics. The first economists, with notable exceptions like Schumpeter and Baumol, never saw new firms as the cradle of the economy's jobs. This book does the best job of correcting this incredible oversight by presenting powerful empirical data on why new firms are so critical to economic expansion and case studies of how misdirected policy holds back job creation. It is a very important contribution to the literature of economic growth, job creation, entrepreneurship, and public policy."
—CARL J. SCHRAMM, former President and CEO of the Ewing Marion Kauffman Foundation, Professor at Syracuse University, and the Ciocca Professor of Innovation at UC Davis

"Wake up, Washington! This book will grab your lapels, look you in the eye, and shout, 'Start-ups are responsible for all net job growth in America. It's that simple.' Using an innovative mix of hard data and myriad interviews of real job creators, Dearie and Geduldig demonstrate this fact and define a compelling policy framework to grow our nation's employment and economy. They must be heard."
—CHARLES M. VEST, President Emeritus of MIT and of the National Academy of Engineering

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