The economy is in meltdown. Wall Street is floundering. Corporations are laying off thousands. The national unemployment rate is at a five-year high. But the New York Times thinks if you’re an entrepreneur, you should close your business and get a job.
In Sunday’s paper an article headlined Economy to Entrepreneurs: Turn Back was filled with example after example of entrepreneurs who have given up their businesses (for various reasons) and returned to the workforce. And miraculously, despite the lousy economy and that current 6.1 percent unemployment rate, none of the people profiled seemed to have a hard time landing a job.
The article also mentioned that we’re headed for an increase in business bankruptcies this year (though since the bankruptcy laws were recently changed, it’s hard to make comparisons to the past). It didn’t mention how many of those bankruptcies were filed by big businesses. Lehman Brothers, anyone? Or the fact the federal government has interceded and bailed out a number of corporate giants before the ax could fall. AIG is just the latest example, as the Fed gallops to the rescue with an $85 billion loan.
When I first read the Times on Sunday I was so enraged I didn’t even know where to begin. This article simply shows how easy it is to make your case by only interviewing people who prove your point. The opposite point could easily have been made by interviewing some of the hundreds of thousands of Americans (like me) who have started or will start a new business this year.
We don’t know how many businesses will actually open their doors this year, but it’s a good bet it will be more than 600,000, since that’s been the case for quite a long time. I know from the folks at Microsoft’s Office Live Small Business (where I also do some blogging) that, in just under the last three years, over one million people have gone there to create a business Web site.
A blogger from the Wall Street Journal took issue with the Times’ point of view. And obviously I echo that position. If you’re an entrepreneur whose business is hurting and you’re thinking of quitting and finding a job, more power to you. But my guess is that’s a small minority of business owners. Who really believes you can find “stability” (as one of the people interviewed said) or security as an employee these days? Or ever actually?
But we don’t need to speculate. Look back to the stock market crash of 1988. Major corporations shed employees by the thousands (like they’re doing now) who had no recourse but to start their own companies. I’ve long referred to these entrepreneurs as corporate refugees or accidental entrepreneurs; they didn’t set out to start businesses, but realized they needed to do something to pay the bills. From this (and a few other factors) the entrepreneurial revolution was born. In fact, a record number of new businesses were created back then. The 1990s was the decade of the entrepreneur, and indeed we ended the decade with millions of new jobs created, innovative new businesses started, and a robust economy, all courtesy of the nation’s (mostly new) entrepreneurs.
So let’s talk about why you entrepreneurs actually are better suited for riding out this economic downturn than many bigger businesses. Lots of big businesses are cutting back on their marketing efforts right now, creating a vacuum you and your business can leap into. Remember all the advantages owning a smaller business gives you — you can act quickly, adjusting your offerings, prices, and marketing efforts. Now is a good time to explore adding new product lines or offering lower-cost items. If you’re a service provider, you might want to offer discounts to clients who pay early or sign multi-year contracts with you.
More people are shopping online now. So if you don’t have a robust Web site, build one. And if you’re thinking of starting a business, make sure the Web plays a big part in your business plan.
Be bold. Everything is negotiable now, particularly if you are in good standing with your banker, suppliers, or landlord. You’ll never know what can be yours simply by asking.
I would never force entrepreneurship down someone’s throat. Certainly, some people aren’t cut out to run their own business. And circumstances can force some entrepreneurs out of business. But to imply that entrepreneurs should cut and run shows that the New York Times really doesn’t understand entrepreneurs very well. We don’t look to others to provide a safety net; entrepreneurs take control. Security is not lining someone else’s pocket while being grateful for the tiny slice they dole out to us. Entrepreneurs are entrepreneurs because we don’t run from risk, we face it head on. So New York Times, if you want to show the other side of the story, the side most entrepreneurs are on, gimme a call.
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