What Happened To All The Freelancers?

July 26, 2015 0 Comments

What does it take to be a business owner these days? Not much, especially with technology. You have the success of private car or ride sharing technology initiated by Uber. You also have AirBnB, which basically allows people rent out their own homes, apartments or property, bringing substantial supplemental income to ordinary people. Then, you have Amway, which is the company leading the industry in multi-level marketing and tools providing the tools for people to become an ‘Independent Business Owner (IBO),’ but more on them later.

Despite the grow of these tools and how easy it has become to make money, I can’t understand why there aren’t more people doing it today. Considering the economy returned to normal (and probably never will), the share of self-employed workers are near all-time lows.

This probably doesn’t make sense, if you’re looking at methodologies such as the ‘Ease of Doing Business’ index, which ranks economies based on their regulatory environment and how conducive it is to conduct business in that particular area. Among all of the nations ranked and studied, the United States is ranked 7th in overall ease of doing business.

Then again, this is compared to a 3 position drop from a year ago, when the US was ranked 4th in its ease of doing business.

It isn’t just self-employed individuals suffering from market withdrawals. New firms are being created near all-time lows, signaling problems within the marketplace that are more than cyclical. There are plenty of things we can probably blame. Higher barriers to entry, a greater reduction in market competition, along with more regulations making it more difficult for smaller businesses to succeed.

Consider that it larger firms can easily pay to comply with the cost of running a business, this can provide a greater understanding of why the firm entry rate has declined over the decades. Along with these factors, a greater concentration of older firms and less younger firms may result in lower productivity, innovation and less jobs that may have been created otherwise.

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