The Involuntary Entrepreneur

Thanks to the recession, more people are going into businesses for themselves. After all, great companies—like Disney, GE, and IBM—were started in economic downturns.

The difference between those guys and the new generation? Today’s entrepreneur would probably rather have a “real” job, the Fiscal Times reports.

The FT arrived at this conclusion after looking at data that said the number of people earning money through self-employment has grown over the past two years at its fastest pace in a decade and a half. Yet the number of new firms that have at least two employees (i.e. the self-employed entrepreneur and one paid employee) is at a 15-year low. That suggests that the latest “entrepreneurs” are just workers in “the gig economy” trying to make ends meet.

Typically, small businesses are seen as the drivers of the economy, with most jobs coming from that sector, but that hasn’t been the case in this recession. Instead:

“The economic landscape is littered with consultants, freelancers and one-person contractors earning less on their own than they made as full-time employees before the 2008 financial collapse. The number of part-time self-employed rose from 33 percent to 41 percent of all self-employed workers between 2007 and 2009, with virtually all of that increase from people reporting they were working part-time because they couldn’t find enough work, according to Steven Hipple, a labor economist at the Bureau of Labor Statistics. ”

Ouch. Just ouch.