Self-Employment As Middle Class Lifejacket
Oct 19th, 2008 | By Dawn R. Rivers | Category: Politics & PolicyIn spite of the fact that microbusinesses make up better than 9 out of 10 U.S. firms, surprisingly little is known about them. That’s because there has been relatively little research done on them. What little is known about microbusinesses almost exclusively concerns microbusiness employers. Neither economic researchers nor federal lawmakers pay much attention to nonemployer businesses.
Among the few things that are known are the facts that there are almost 21 million of them and that they generated roughly $950 billion, or 7.5% of GDP, in 2006. But perhaps a more important function of nonemployer firms is that they represent the efforts of middle class families to avoid drowning in an unfriendly economic environment. With regular monthly expenses climbing and wages stagnant or flat, middle class households are certainly being squeezed. Some get additional jobs or work more hours, while others borrow (or they used to). But some start part-time nonemployer ventures to help make ends meet. That alone makes the nonemployer firm a critical component of the economy. More than anything else, policy makers must be brought to see the growth in self-employment of the last ten years as an ally, a trend that can support middle class families without the expense of government handouts or the political intrusiveness of most income redistribution schemes.
