Photo: By Peter Hilton on flickr
While recently it seems like every year is a bad time to be expanding your business or starting out on your own, the truth is that now is really not such a bad time.Many states and industries are booming even with the current economy bumping meagerly along. Here are some startup trends to look for in the New Year.
One of the most surprising facts about the current economic state is that the most effective stimulus has not been the bank bailout (worth $700 billion) or the American Recovery and Reinvestment Act of 2009 (worth $787 billion). Instead, most Americans are finding that the recession has been the biggest stimulus for creating new opportunity.
Almost 9 per cent of people looking for employment solved their job woes by starting their own businesses — a huge leap up from only 2 per cent in 2008. This means that in the last two years, the number of people starting their own businesses has quadrupled, indicating the recession is not as bad in some industries as in others. It is also interesting to note that more than half of the Fortune 500 companies listed today were started during a down market. While it may not seem like it now, your small company started today could be a new Fortune 500 company 10 years down the road.
The current economic climate is not known for being overly business friendly, but the recently enacted Small Business Jobs Act promises to help a little in that department. Created to incentivise small businesses and promote entrepreneurship, the Small Business Jobs Act improved tax deductions by increasing the amount that startup owners are allowed to deduct on business start-up expenses from $5,000 to $10,000.
The Act also made available deductions for personal health insurance and changed the ability of C-Corporations to convert into S-Corporations and sell assets more quickly, potentially avoiding significant tax liability.
Finally, the Act expanded the opportunities for small business financing by founding the Small Business Administration which acts as a guarantee for private loans provided by banks and institutions. The loan limits on some loans were increased from $1.5 million to $5.5 million while borrower fees were decreased or eliminated entirely. The Small Business Jobs Act is a big step up in improving the way businesses can operate.
Even in this down time, some industries are doing exceptionally well. “Green” companies that focus on using clean energy are becoming popular with consumers. People are exerting real efforts to watch what they do and what they use, and companies that cater to those public sentiments are increasingly gaining customers. Local businesses are also experiencing hikes in customers as people return to small town roots. Restaurants that specifically purchase from local farmers and mum and pop shops are nostalgic reminders of happier times and consumers are choosing to take their business to these types of establishments over the big chains.
The ageing American population is also having an effect on industry growth. As the baby boomers grow older and retire, businesses specifically focusing the needs of the aged are expanding too. Companies that offer tech help services, home healthcare, and elderly and disabled assistance are seeing big jumps in customers and will continue to for many years to come.
There are many hopes for more jobs for people and a better economy as we move into the year 2011. The positive trends we are seeing now don’t appear to be coming to an end any time soon, and the economy is said to be improving, if a little slowly. These trends mentioned above and the many more that are affecting industry offer a little proof of this improvement and provide foundation for the hope for the future.
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