Monday, June 17, 2013

U.S.: Where are the entrepreneurs?

Our previous post mentioned the burdens progressives such as Paul Krugman want to place on entrepreneurs. Now a new Barclays study finds developing countries are already far ahead of the U.S. when comes to entrepreneurial wealth creation:
The above chart is a stunning indictment of the U.S.’s declining ability to nurture entrepreneurs. Worldwide, 40% of millionaires (those with investable assets of $1.5 million or more) cited a "business sale or profit" from their business as their source of wealth. Only a quarter of the millionaires cited inheritance as their wealth source. In the Asia-Pacific region, 57% cited business sale or profit as a source of wealth, in South Africa 68%, and in Latin America 58%. Even in slow growth “old Europe,” entrepreneurs are twice as lively as their U.S. counterparts.

In the U.S., only 21% of millionaires cited business sale or profit as their source of wealth. A much larger percentage cited saved earnings or personal investments. And there is further proof the entrepreneurial spirit lags at home. A Kauffman Foundation report on the U.S. found there were just 514,000 new business owners a month in 2012, down from 543,000 in 2011. The 2012 numbers marked the lowest in five years. Also, the Hudson Institute reported that brand-new companies added only 2.34 million jobs in 2010; new companies had on average added 3 million new jobs a year going back to 1977.

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