2009 Executive Report

Transcription

1 2009 Executive Report Abdul Ali I. Elaine Allen William D. Bygrave Julio De Castro Julian Lange Thomas S. Lyons Joseph Onochie Ivory Phinisee Edward Rogoff Al Suhu John Whitman

2 Global Entrepreneurship Monitor 2009 National Entrepreneurial Assessment for the United States of America 1

3 2

4 Global Entrepreneurship Monitor 2009 National Entrepreneurial Assessment for the United States of America 3

5 Table of Contents Introduction 10 The GEM Model 10 GEM and the Link Between Entrepreneurship and Economic Development 14 How GEM Measures Entrepreneurship 15 GEM Website, National Reports and Data Availability 16 GEM Terminology 17 1 Entrepreneurial Behavior in The United States From 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior 18 Trends in Total Entrepreneurship Activity 18 Total Entrepreneurship Activity and Gender 19 Total Entrepreneurship Activity and Age 20 Total Entrepreneurship Activity and Work Status 21 Total Entrepreneurship Activity and Educational Status 22 Total Entrepreneurship Activity and Income 24 Entrepreneurs and Their Motivations 25 Final Comments 27 2 International Comparison: The United States and Other Countries 28 Activity 28 Attitudes 35 Aspirations 39 Conclusion 42 Bibliography 42 3 Does Innovation Drive Entrepreneurship? 43 Innovativeness and Customer Novelty 43 Activity in Technology Sector 45 Spending on Technology 46 Finding Business Success 46 4 Social Entrepreneurship 48 The Key Questions 48 Goals and Values 48 Social, Environmental And Community Objectives 53 5 The Impact of the Recession on the Entrepreneurial Composition of the United States by Region, Population Group and Minorities 55 4

6 Table of Contents 6 Financing 61 Small Business Lending 61 Informal Investing 61 Venture Capital 62 Impact of Economic Declines on Economic Activity 65 7 Public Policy in the United States 65 GEM National Teams Appendix 80 GEM Sponsors 81 Endnotes 85 List of Tables and Exhibits Table 1 Importance of Different Types of National Conditions for Economic Development 12 Table 2 Prevalence Rates (in Percentage) of Entrepreneurial Activity and Business owner-managers Across GEM Countries in 2009, Age Group, by Phase of Economic Development 29 Table 3 United States Survey Demographics, Table 4 Measures of Entrepreneurial Activity 56 Table 5 Measures of Entrepreneurial Activity by White/Caucasian and Non-White/Caucasian 57 Table 6 Entrepreneurial Activity by Gender 58 Table 7 Measures of Entrepreneurship Attitudes Based on Size of Firm 59 Table 8 Industry Distribution by Early-Stage and Established Business Owner Entrepreneurs 60 Table 9 U.S. Percentage Growth Rates by Industry 68 Table 10 Change in U.S. Employment, Business Establishments and Firms 69 Table 11 U.S. Dynamism 71 Table A1 Comparison of Entrepreneurial Activity for 2007, 2008 and 2009 by Phase of Economic Development for the Percentage of the Age Group 80 List of Figures Figure 1 The GEM Model 14 Figure 2 Summarizes the Entrepreneurial Process and GEM s Operational Definitions 16 Figure 3 Total Entrepreneurship Activity, Owner Managed Business and Discontinued Businesses, Figure 4 Percentage of Nascent and New Businesses, Figure 5 Total Entrepreneurship Activity and Gender Figure 6 TEA by Age Group, Figure 7 Percentage of Nascent and New Businesses by Age Group, Figure 8 Work Status Over Time, Figure 9 Percentage of Nascent and New Businesses by Work Status Figure 10 Educational Status Over Time, Figure 11 Percentage of Nascent and New Businesses by Educational Status, Figure 12 Household Income Over Time, Figure 13 Percentage of Nascent and New Businesses by Household Income

7 Table of Contents Figure 14 Entrepreneur Knows an Entrepreneur 26 Figure 15 Entrepreneur Sees Good Opportunities for Starting a Business 26 Figure 16 Entrepreneur Has Knowledge and Skills 26 Figure 17 Sector Distribution Early-Stage Entrepreneurial Activity (18 64 Age Group), Figure 18 Sector Distribution Established Business (18 64 Age Group), Figure 19 Early-Stage Entrepreneurial Activity for Separate Age Groups, Figure 20 Total Early-Stage Entrepreneurial Activity (TEA) Rates, , Averages 32 Figure 21 Nascent Entrepreneurial Activity Rates, , Averages 33 Figure 22 Necessity-Driven Opportunity TEA Rates, , Averages Over Efficiency-Driven Countries, Innovation-Driven Countries and the United States 34 Figure 23 Total Early-Stage Entrepreneurship by Gender 35 Figure 24 Perceived Opportunities for Starting a Business, Figure 25 Fear of Failure Among Those Who Perceive Good Start-Up Opportunities, Figure 26 Perceived Skills and Knowledge to Start a New Business, Figure 27 Intentions to Start a New Business in the Next Three Years, Figure 28 High-Growth Expectation Early-Stage Entrepreneurial Activity by Country (18 64 Age Group) 40 Figure 29 Figure 30 Figure Entrepreneur s Views on Starting a Business in Comparison to One Year Ago by Phase of Economic Development (Unweighted Country Averages) %Yes Entrepreneur s Views on Growing a Business in Comparison to One Year Ago by Phase of Economic Development (Unweighted Country Averages) %Yes 41 Impact of the Global Economic Slowdown on Entrepreneurs Perception of Opportunities for their Business, According to the Entrepreneurs (Unweighted Country Averages) %Yes 42 Figure 32 Percentage of Business Entities with New Product-Market Combinations 43 Figure 33 Impact of Business Entities Perceptions of Economic Outlook on Innovation 44 Figure 34 Percentage of Business Entities Active in Medium- or High-Technology Sector 45 Figure 35 Percentage of Business Entities Spending on Technology in Figure 36 Percentage of Business Entities Finding Success 47 Figure 37 Entrepreneurship Goals Among Start-Ups 49 Figure 38 Entrepreneurship Goals Among Ongoing Ventures 50 Figure 39 Goals by Gender for Start-Ups 51 Figure 40 Goals by Gender for Ongoing Businesses 52 Figure 41 Venture Capital IRR and Total Amount Raised by VC-Backed IPOs 63 Figure 42 Venture Capital Investments in Clean-Tech in United States 64 Figure 43A U.S. Entrepreneurial Trends with Real GDP 66 Figure 43B Percent Changes: U.S. Real GDP and Key Components 67 Figure 44 GEM U.S. National Expert Survey Mean Response for New Firm Entrepreneurship Opportunity 70 Figure 45 GEM U.S. National Expert Survey Mean Response for Available Funding 71 Exhibits Exhibit 1 Early-Stage Entrepreneurship Among Ethnicities 56 6

8 7 Executive Summary THE UNITED STATES HAS STABILITY IN ESTABLISHED BUSINESSES, BUT STALLS ON OTHER FRONTS

9 8 Executive Summary

10 Executive Summary 9

11 10 Introduction THE GEM MODEL

12 Introduction Box 1 The Role of Entrepreneurship in Different Phases of Economic Development KEY AREAS OF INTEREST FOR POLICY MAKERS 11

13 Introduction Table 1 Importance of Different Types of National Conditions for Economic Development BASIC REQUIREMENTS EFFICIENCY ENHANCERS ENTREPRENEURIAL CONDITIONS FACTOR-DRIVEN ECONOMIES Key Focus Develop Start Enabling EFFICIENCY-DRIVEN ECONOMIES Maintain Key Focus Develop INNOVATION-DRIVEN ECONOMIES Maintain Maintain Key Focus 12 ENTREPRENEURSHIP: ATTITUDES, ACTIVITY AND ASPIRATIONS

14 13 Introduction ENTREPRENEURIAL FRAMEWORK CONDITIONS

15 Introduction Figure 1 The GEM Model Social, Cultural, Political Context From Other Available Sources From GEM National Expert Surveys (NES) Basic Requirements - Institutions - Infrastructure - Macroeconomic Stability - Health and Primary Education Efficiency Enhancers - Higher education and Training - Goods Market Efficiency - Labor Market Efficiency - Financial Market Sophistication - Technological Readiness - Market Size Innovation and Entrepreneurship - Entrepreneurial Finance - Government Policies - Government Entrepreneurship Programs - Entrepreneurship Education - R&D Transfer - Commercial, Legal Infrastructure for Entrepreneurship - Internal Market Openness - Physical Infrastructure for Entrepreneurship - Cultural, Social Norms Established Firms (Primary Economy) Activity: Early-Stage Persistence Exits Entrepreneurship Attitudes: Perceived Opportunities Perceived Capacity Aspirations: Growth Innovation Social Value Creation From GEM Adult Population Surveys (APS) New Branches, Firm Growth National Economic Growth (Jobs and Technical Innovation) 14 GEM AND THE LINK BETWEEN ENTREPRENEURSHIP AND ECONOMIC DEVELOPMENT

16 15 HOW GEM MEASURES ENTREPRENEURSHIP

17 Figure 2 Summarizes the Entrepreneurial Process and GEM s Operational Definitions Discontinuation of Business Total Early-Stage Entrepreneurial Activity (TEA) Potential Entrepreneur: Opportunities, Knowledge and Skills Nascent Entrepreneur: Involved in Setting Up a Business Owner-Manager of a New Business (up to 3.5 years old) Owner-Manager of an Established Business (more than 3.5 years old) Conception Firm Birth Persistence GEM WEBSITE, NATIONAL REPORTS AND DATA AVAILABILITY 16

18 GEM Terminology Nascent Entrepreneur New Firm Entrepreneur Established Business Owner New Business Ownership Rate Dynamism Total Early-Stage Entrepreneurial Activity (TEA Rate) Overall Entrepreneurial Activity Rate Business Discontinuation Rate Fear-of-Failure Rate Entrepreneurial Intention Perceived Opportunities Perceived Capabilities Necessity-Driven Entrepreneurial Activity Improvement-Driven Opportunity Entrepreneurial Activity A nascent entrepreneur is one who is actively planning a new venture. Such an entrepreneur has done something during the previous 12 months to help start a new business that he or she will own, at least in part. Activities such as organizing the start-up team, looking for equipment, saving money for the start-up or writing a business plan would all be considered active commitments to starting a business. Wages or salaries will have been paid for no more than three months; nascent entrepreneurs are often still employed full-time elsewhere. A new firm entrepreneur is an entrepreneur who, at least in part, owns and manages a new business that is between 4 and 42 months old and has not paid salaries for longer than this period. In addition to those individuals who are currently involved in the early stages of a business, there are also many individuals who have set up businesses that they have continued to own and manage for a longer time. These individuals are included in the established business owner index, which captures the percentage of individuals in a population who have set up businesses that they continue to own and manage and who have paid wages or salaries for more than 42 months. Percentage of the age group who are currently owner-managers of new businesses, i.e., owning and managing a running business that has paid salaries, wages or any other payments to the owners for more than 3 months but not more than 42 months. As used in this report, dynamism is defined as the ratio of early-stage entrepreneurship to established business ownership. This ratio shows the relative activity levels among early-stage entrepreneurs compared to the prevalence of established business owners. Low levels of dynamism indicate a less entrepreneurial environment. As its name implies, total early-stage entrepreneurial activity refers to the total rate of early-stage entrepreneurial activity among adults in the age group, inclusive. In some instances, this rate is less than the combined percentages for nascent and new firm entrepreneurs because in circumstances where a respondent qualifies as both a nascent and a new firm entrepreneur, he or she is counted only once. Percentage of the age group who are currently engaged in early-stage entrepreneurial activity or owner-manager of an established business (as defined above). Percentage of the age group who have, in the past 12 months, discontinued a business, either by selling, shutting down or otherwise discontinuing an owner-management relationship with the business. Note: This is not a measure of business failure rates. Percentage of the age group with positive perceived opportunities (individuals involved in any stage of entrepreneurial activity excluded) who indicate that fear of failure would prevent them from setting up a business. Percentage of the age group (individuals involved in any stage of entrepreneurial activity excluded) who intend to start a business within three years. Percentage of the age group (individuals involved in any stage of entrepreneurial activity excluded) who see good opportunities to start a firm in the area where they live. Percentage of the age group (individuals involved in any stage of entrepreneurial activity excluded) who believe they have the required skills and knowledge to start a business. Percentage of those involved in early-stage entrepreneurial activity (as defined above) who are involved in entrepreneurship because they had no other option for work. Percentage of those involved in early-stage entrepreneurial activity (as defined above) who (i) claim to be driven by opportunity as opposed to finding no other option for work; and (ii) indicate the main driver for being involved in this opportunity is being independent or increasing their income, rather than just maintaining their income. 17

19 1 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Julio De Castro and I. Elaine Allen TRENDS IN TOTAL ENTREPRENEURSHIP ACTIVITY Figure 3 Total Entrepreneurship Activity, Owner Managed Business and Discontinued Businesses, TEA Own-Manage Discontinued Businesses Source: GEM United States Adult Population Surveys (APS) 18

20 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 4 Percentage of Nascent and New Businesses, % 90.0% 80.0% Nascent Business New Business 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Source: GEM United States Adult Population Surveys (APS) TOTAL ENTREPRENEURSHIP ACTIVITY AND GENDER Figure 5 Total Entrepreneurship Activity and Gender, % 14.0% 12.0% TEA Male TEA Female Own-Manage Business Male Own-Manage Business Female Discontinued Business Male Discontinued Business Female 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Source: GEM United States Adult Population Surveys (APS)

21 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior TOTAL ENTREPRENEURSHIP ACTIVITY AND AGE Figure 6 TEA by Age Group, % 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 12.2% 10.6% 9.0% 10.2% 7.6% 15.5% 13.7% 12.2%12.3% 11.5% 15.3% 12.5% 11.2% 10.7% 7.6% 9.5% 8.3% 10.3% 9.5% 7.8% 7.2% 7.0% 5.7% 5.9% 5.4% 2.4% 1.2% 2.0% 2.4% 1.8% Years Years Years Years Years 65 Years and Over Source: GEM United States Adult Population Surveys (APS) 20

22 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 7 Percentage of Nascent and New Businesses by Age Group, % 35.0% Nascent Business New Business 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Years Years Years Years Years 65 Years and Older Years Years Years Years Years 65 Years and Older Years Years Years Years Years 65 Years and Older Years Years Years Years Years 65 Years and Older Years Years Years Years Years 65 Years and Older Source: GEM United States Adult Population Surveys (APS) TOTAL ENTREPRENEURSHIP ACTIVITY AND WORK STATUS 21

23 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 8 Work Status Over Time, % 14.0% 12.0% 10.0% TEA Own-Manage Business Discontinued Business 8.0% 6.0% 4.0% 2.0% 0.0% Work: Full-Time and Part-Time Not Working Retired Students Source: GEM United States Adult Population Surveys (APS) Figure 9 Percentage of Nascent and New Businesses by Work Status, % 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Nascent Business New Business Work: Full-Time, Part-Time Not working Retired/Students Work: Full-Time, Part-Time Not working Retired/Students Work: Full-Time, Part-Time Not working Retired/Students Work: Full-Time, Part-Time Not working Retired/Students Work: Full-Time, Part-Time Not working Retired/Students Source: GEM United States Adult Population Surveys (APS) TOTAL ENTREPRENEURSHIP ACTIVITY AND EDUCATIONAL STATUS 22

24 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 10 Educational Status Over Time, % TEA Own-Manage Business 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Some Secondary Education Secondary Education Degree Post-Secondary Education Graduate Education Experience Source: GEM United States Adult Population Surveys (APS) 23

25 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior 60.0% Figure 11 Percentage of Nascent and New Businesses by Educational Status, Nascent Business New Business 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% SOME SECONDARY EDUCATION SECONDARY EDUCATION DEGREE POST-SECONDARY EDUCATION GRADUATE EDUCATION EXPERIENCE SOME SECONDARY EDUCATION SECONDARY EDUCATION DEGREE POST-SECONDARY EDUCATION GRADUATE EDUCATION EXPERIENCE SOME SECONDARY EDUCATION SECONDARY EDUCATION DEGREE POST-SECONDARY EDUCATION GRADUATE EDUCATION EXPERIENCE SOME SECONDARY EDUCATION SECONDARY EDUCATION DEGREE POST-SECONDARY EDUCATION GRADUATE EDUCATION EXPERIENCE SOME SECONDARY EDUCATION SECONDARY EDUCATION DEGREE POST-SECONDARY EDUCATION GRADUATE EDUCATION EXPERIENCE Source: GEM United States Adult Population Surveys (APS) TOTAL ENTREPRENEURSHIP ACTIVITY AND INCOME 24

26 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 12 Household Income Over Time, % 14.0% 12.0% 10.0% TEA Own/Manage Business Discontinued Business 8.0% 6.0% 4.0% 2.0% 0.0% Lowest 33%tile Middle 33%tile Upper 33%tile Source: GEM United States Adult Population Surveys (APS) Figure 13 Percentage of Nascent and New Businesses by Household Income % 60.0% Nascent Business New Business 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Lowest Middle Upper Lowest Middle Upper Lowest Middle Upper Lowest Middle Upper Lowest Middle Upper Source: GEM United States Adult Population Surveys (APS) ENTREPRENEURS AND THEIR MOTIVATIONS 25

27 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior Figure 14 Entrepreneur Knows an Entrepreneur 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% TEA NO TEA YES Own/Manage Business NO Own/Manage Business YES Discontinued Business NO Discontinued Business YES Source: GEM United States Adult Population Surveys (APS) Figure 15 Entrepreneur Sees Good Opportunities for Starting a Business 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% TEA NO TEA YES Own/Manage Business NO Own/Manage Business YES Discontinued Business NO Discontinued Business YES 20.0% 10.0% 0.0% Source: GEM United States Adult Population Surveys (APS) 100.0% 90.0% 80.0% 70.0% 60.0% 50.0% Figure 16 Entrepreneur Has Knowledge and Skills % 30.0% 20.0% 10.0% 0.0% TEA NO TEA YES Own/Manage Business NO Own/Manage Business YES Discontinued Business NO Discontinued Business YES Source: GEM United States Adult Population Surveys (APS)

28 Entrepreneurial Behavior in the United States from 2005 to 2009: A Contextual View of the Effects of the Economic Crisis on Entrepreneurial Behavior FINAL COMMENTS 27

29 2 International Comparison: The United States and Other Countries GEM PARTICIPATING COUNTRIES IN 2009 In total, 54 countries participated in the GEM project in The countries in this report are grouped into three stages of economic development as defined by the World Economic Forum s Global Competitiveness Report: Factor-Driven, Efficiency- Driven and Innovation-Driven. This classification in stages of economic development is based on the level of GDP per capita. Factor-Driven Economies Algeria,* Guatemala,* Jamaica,* Lebanon,* Morocco,* Saudi Arabia, Syria,* Kingdom of Tonga, Uganda, Venezuela,* West Bank and Gaza Strip, Yemen Efficiency-Driven Economies Argentina,* Bosnia and Herzegovina, Brazil, Chile,* China, Colombia, Croatia,* Dominican Republic, Ecuador, Hungary,* Iran, Jordan, Latvia,* Malaysia, Panama, Peru, Romania*, Russia,* Serbia, South Africa, Tunisia, Uruguay* Innovation-Driven Economies Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, Israel, Italy, Japan, Republic of Korea, Netherlands, Norway, Slovenia, Spain, Switzerland, United Arab Emirates, United Kingdom, United States *Country in transition to more advanced stage ACTIVITY Entrepreneurial Activity Entrepreneurial Motivations 28 1 This concerns the following efficiency-driven countries: Argentina, Brazil, Chile, Croatia, Hungary and South Africa. Innovation economies include: Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Italy, Japan, Netherlands, Norway, Slovenia, Spain, United Kingdom and United States of America. 2 Missing data have been estimated as a function of the existing data.

30 International Comparison: The United State and Other Countries Table 2 Prevalence Rates (in %) of Entrepreneurial Activity and Business Owner-Managers Across GEM Countries in 2009, Age Group, by Phase of Economic Development NASCENT ENTREPRENEURSHIP RATE % NEW BUSINESS OWNERSHIP RATE % EARLY-STAGE ENTREPRENEURIAL ACTIVITY (TEA) % ESTABLISHED BUSINESS OWNERSHIP RATE % DISCONTINUATION OF BUSINESSES % NECESSITY-DRIVEN (% OF TEA) IMPROVEMENT- DRIVEN OPPORTUNITY (% OF TEA) Factor-Driven Economies Algeria Guatemala Jamaica Lebanon Morocco Saudi Arabia Syria Tonga Uganda Venezuela West Bank & Gaza Strip Yemen average (unweighted) Efficiency-Driven Economies Argentina Bosnia and Herzegovina Brazil Chile China Colombia Croatia Dominican Republic Ecuador Hungary Iran Jordan Latvia Malaysia Panama Peru Romania Russia Serbia South Africa Tunisia Uruguay average (unweighted) Innovation-Driven Economies Belgium Denmark Finland France Germany Greece Hong Kong Iceland Israel Italy Japan Korea Netherlands Norway Slovenia Spain Switzerland United Arab Emirates United Kingdom United States average (unweighted) Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. 29

31 International Comparison: The United States and Other Countries Discontinuing Business Entrepreneurial Activity by Sector Distributions Figure 17 Sector Distribution Early-Stage Entrepreneurial Activity (18 64 Age Group), 2009 Factor-Driven Economies Extractive Efficiency-Driven Economies Innovation-Driven Economies Transforming Business Services Consumer-Oriented United States 0% 20% 40% 60% 80% 100% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. 30

32 International Comparison: The United States and Other Countries Figure 18 Sector Distribution Established Business (18 64 Age Group), 2009 Factor-Driven Economies Extractive Efficiency-Driven Economies Innovation-Driven Economies Transforming Business Services Consumer-Oriented United States 0% 20% 40% 60% 80% 100% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. Entrepreneurial Activity by Age Group 25% Figure 19 Early-Stage Entrepreneurial Activity for Separate Age Groups, Years Years Years Years Years 20% Percentage of Adult Population in Age Group 15% 10% 5% 0% Factor-Driven Economies Efficiency-Driven Economies Innovation-Driven Economies Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. United States 31

33 International Comparison: The United States and Other Countries Trends in the Total Early-Stage (TEA) Entrepreneurial Activity Figure 20 Total Early-Stage Entrepreneurial Activity (TEA) Rates, , Averages Over Efficiency-Driven Countries, Innovation-Driven Countries and the United States Innovation-Driven Economies Efficiency-Driven Economies United States 14% 12% 10% 8% 6% 4% 2% 0% Source: GEM Adult Population Surveys (APS) 32

34 International Comparison: The United States and Other Countries Figure 21 Nascent Entrepreneurial Activity Rates, , Averages Over Efficiency-Driven Countries, Innovation-Driven Countries and the United States Innovation-Driven Economies Efficiency-Driven Economies United States 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% Source: GEM Adult Population Surveys (APS) 3 Schumpeter argued that when innovative new firms were allowed to compete they would use their creativity to destroy older firms that did not match up. Therefore, social well-being as a whole is improved. 33

35 International Comparison: The United States and Other Countries Trends in Entrepreneurial Motivations Figure 22 Necessity-Driven Opportunity TEA Rates, , Averages Over Efficiency-Driven Countries, Innovation-Driven Countries and the United States Innovation-Driven Economies Efficiency-Driven Economies United States 10 % 8 % 6 % 4 % 2 % 0 % Source: GEM Adult Population Surveys (APS) Total Early-Stage Entrepreneurial Activity and Gender 34

36 International Comparison: The United States and Other Countries Figure 23 Total Early-Stage Entrepreneurship by Gender Percentage of Adult Population in Age Group 18% 16% 14% 12% 10% 8% 6% 4% Male Efficiency Female Efficiency Male Innovation Female Innovation Male United States Female United States 2% 0% Source: GEM Adult Population Surveys (APS) ATTITUDES 35

37 International Comparison: The United States and Other Countries Figure 24 Perceived Opportunities for Starting a Business, Innovation-Driven Economies Efficiency-Driven Economies United States 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. 36

38 International Comparison: The United States and Other Countries Figure 25 Fear of Failure Among Those Who Perceive Good Start-Up Opportunities, Innovation-Driven Economies Efficiency-Driven Economies United States 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. 37

39 International Comparison: The United States and Other Countries Figure 26 Perceived Skills and Knowledge to Start a New Business, Innovation-Driven Economies Efficiency-Driven Economies United States 60% 50% 40% 30% 20% 10% 0% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. 38

40 International Comparison: The United States and Other Countries Figure 27 Intentions to Start a New Business in the Next Three Years, Innovation-Driven Economies Efficiency-Driven Economies United States 25% 20% 15% 10% 5% 0% Source: GEM Global 2009 Adult Population Survey (APS). For international comparisons, sample based on Age Group. ASPIRATIONS 39

41 International Comparison: The United States and Other Countries Figure 28 High-Growth Expectation Early-Stage Entrepreneurial Activity by Country (18 64 Age Group): % COUNTRY MEAN PHASE AVERAGE 50% Percentage of Early-Stage Entrepreneurs 40% 30% 20% 10% 0% Jamaica India Venezuela AVERAGE Brazil Hungary Peru Dominican Serbia Chile Croatia Argentina Romania Latvia Russia AVERAGE Spain Finland Greece Belgium Netherlands France Germany Norway Italy Switzerland Australia Japan Ireland Sweden Slovenia United States United Kingdom Canada Denmark Iceland Singapore Israel Hong Kong United Arab Emirates AVERAGE Factor-driven Efficiency-driven Innovation-driven Source: GEM Global 2009 Adult Population Survey (APS) The Impact of the Recession on Entrepreneurial Activity According to the Entrepreneurs 40 4 See Acs, 2008; Autio, 2007.

42 International Comparison: The United States and Other Countries Figure Entrepreneurs Views on Starting a Business in Comparison to One Year Ago by Phase of Economic Development (Unweighted Country Averages) %Yes 90% 80% 70% Factor-Driven Economies Innovation-Driven Economies Efficiency-Driven Economies United States 60% 50% 40% 30% 20% 10% 0% Less Difficult About the Same More Difficult Less Difficult About the Same More Difficult Less Difficult About the Same More Difficult Nascent Entrepreneurs Owner-Managers of New Businesses Owner-Managers of Established Businesses Source: GEM 2009 Adult Population Survey (APS) Figure Entrepreneurs Views on Growing a Business in Comparison to One Year Ago by Phase of Economic Development (Unweighted Country Averages) %Yes 60% 50% Factor-Driven Economies Innovation-Driven Economies Efficiency-Driven Economies United States 40% 30% 20% 10% 0% Less Difficult About the Same More Difficult Less Difficult About the Same More Difficult Less Difficult About the Same More Difficult Source: GEM 2009 Adult Population Survey (APS) Nascent Entrepreneurs Owner-Manager of New Businesses Owner-Manager of Established Businesses 41

43 International Comparison: The United States and Other Countries Figure 31 Impact of the Global Economic Slowdown on Entrepreneurs Perception of Opportunities for Their Business, According to the Entrepreneurs (Unweighted Country Averages) %Yes 80% 70% Factor-Driven Economies Innovation-Driven Economies Efficiency-Driven Economies United States 60% 50% 40% 30% 20% 10% 0% Fewer Business Opportunities About the Same More Business Opportunities Fewer Business Opportunities About the Same More Business Opportunities Fewer Business Opportunities About the Same More Business Opportunities Source: GEM 2009 Adult Population Survey (APS) Nascent Entrepreneurs Owner-Managers of New Businesses Owner-Managers of Established Businesses CONCLUSION BIBLIOGRAPHY 42

44 3 Does Innovation Drive Entrepreneurship? INNOVATIVENESS AND CUSTOMER NOVELTY Figure 32 Percentage of Business Entities with New Product-Market Combinations 30.0% 25.0% Percentage of business Entities with New Product-Market Combinations 20.0% 15.0% 10.0% Early-Stage Entrepreneurial Activity Established Business 5.0% 0.0% Source: GEM U.S and 2009 Adult Population Surveys (APS) 43

45 Does Innovation Drive Entrepreneurship? Impact of Economic Outlook on Innovation in 2009 Figure 33 Impact of Business Entities Perceptions of Economic Outlook on Innovation 80.00% 70.00% Percentage of Business Entities 60.00% 50.00% 40.00% 30.00% 20.00% SU: Start-Up EB: Established Business 10.00% 0.00% SU EB SU EB SU EB Difficult to Start Business Source: GEM U.S 2009 Adult Population Survey (APS) Low Expectation for Growth Fewer Business Opportunities 44

46 Does Innovation Drive Entrepreneurship? ACTIVITY IN TECHNOLOGY SECTOR Figure 34 Percentage of Business Entities Active in Medium- or High-Technology Sector 9.0% 8.0% Percentage of Business Entities Active in Technology Sector 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% % Early-Stage Entrepreneurial Activity Established Business Source: GEM U.S and 2009 Adult Population Surveys (APS) 45

47 Does Innovation Drive Entrepreneurship? SPENDING ON TECHNOLOGY Figure 35 Percentage of Business Entities Spending on Technology in % 8.0% Percentage of Business Entities Active in Technology Sector 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% % Early-Stage Entrepreneurial Activity Established Business Source: GEM U.S and 2009 Adult Population Surveys (APS) FINDING BUSINESS SUCCESS 46

48 Does Innovation Drive Entrepreneurship? Figure 36 Percentage of Business Entities Finding Success 9.0% 8.0% Percentage of Business Entities Active in Technology Sector 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% % Early-Stage Entrepreneurial Activity Established Business Source: GEM U.S and 2009 Adult Population Surveys (APS) 47

49 48 4 Social Entrepreneurship THE KEY QUESTIONS GOALS AND VALUES

50 Social Entrepreneurship Figure 37 Entrepreneurship Goals Among Start-Ups 60% 50% % Percentage of Entrepreneurs 30% 20% 10% 0% Economic Goals Social Goals Economic and Social Goals Not-for-Profit Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 49

51 Social Entrepreneurship Figure 38 Entrepreneurship Goals Among Ongoing Ventures 70% % 50% Percentage of Entrepreneurs 40% 30% 20% 10% 0% Economic Goals Social Goals Economic and Social Goals Not-for-Profit Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 50

52 Social Entrepreneurship Figure 39 Goals by Gender for Start-Ups 90% 80% Female Male 70% 60% Percentage of Entrepreneurs 50% 40% 30% 20% 10% 0% Economic Goals Social Goals Economic and Social Goals Not-for-Profit Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 51

53 Social Entrepreneurship 80% Figure 40 Goals by Gender for Ongoing Businesses 70% Female Male 60% 50% Percentage of Entrepreneurs 40% 30% 20% 10% 0% Economic Goals Social Goals Economic and Social Goals Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) Not-for-Profit 52

54 53 SOCIAL, ENVIRONMENTAL AND COMMUNITY OBJECTIVES Social Entrepreneurship

55 Social Entrepreneurship CONCLUSION 54

56 5 The Impact of the Recession on the Entrepreneurial Composition of the United States by Region, Population Group and Minorities Table 3 United States Survey Demographics, Mean Age 48.6% 46.0% % Male 53.1% 48.6% % Female 46.9% 51.4% % Within the Following Ethnic Groups White/Caucasian 79.8% 80.0% Non-White/Caucasian 20.2% 20.0% % Immigrants 7.5% 7.0% % Educational Attainment None 2.7% 3.0% Some Secondary 8.6% 10.1% Secondary Degree 22.8% 24.2% Post-Secondary 24.9% 21.3% University Bachelors Degree or Higher 41.0% 41.3% % Geography U.S. Census Bureau Regions Northeast 19.9% 18.5% Midwest 22.7% 22.1% South 35.9% 36.4% West 21.5% 23.3% % Early-Stage Entrepreneurs 8.7% 6.9% % Established Entrepreneurs 7.7% 5.7% % Opportunity Entrepreneurs 7.2% 4.8% % Necessity Entrepreneurs 1.0% 1.6% Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 55

57 The Impact Of The Recession On The Entrepreneurial Composition Of The United States By Region, Population Group And Minorities Exhibit 1 Early-Stage Entrepreneurship Among Ethnicities TEA RATE Ethnicity American Indian 12.5% 5.8% White/Caucasian 8.4% 6.5% Black/African-American 13.3% 7.0% Hispanic/Latino (non-mexican) 8.6% 10.7% Mexican 12.5% 15.0% Asian 7.9% 8.8% Other 8.7% 7.7% Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) Table 4 Measures of Entrepreneurial Activity UNITED STATES CENSUS REGIONS YEAR NORTHEAST MIDWEST SOUTH WEST UNITED STATES Involved in Any Kind of Entrepreneurial Activity Involved in Total Early-Stage Entrepreneurial Activity Involved in Opportunity Early-Stage Entrepreneurial Activity Involved in Necessity Early-Stage Entrepreneurial Activity Actively Involved in Start-Up Effort; Owner, No Wages Yet Manages and Owns a Business That Is Up to 42 Months Old Manages and Owns a Business That Is Older Than 42 Months % 23.7% 28.3% 34.7% 28.3% % 21.2% 25.9% 27.3% 25.0% % 7.4% 8.6% 11.1% 8.7% % 4.8% 8.1% 7.6% 6.9% % 6.8% 6.4% 9.7% 7.3% % 2.7% 5.9% 5.0% 4.8% %.2% 1.4%.9% 1.0% % 1.5% 1.7% 1.7% 1.6% % 4.3% 5.4% 4.7% 4.8% % 3.4% 4.3% 4.6% 4.2% % 3.2% 3.2% 6.5% 4.0% % 1.4% 3.7% 3.2% 2.7% % 7.1% 7.5% 8.8% 7.8% % 5.1% 5.7% 6.6% 5.7% Shut Down a Business in the % 1.8% 3.1% 2.7% 2.5% Past 12 Months % 1.7% 2.6% 3.0% 2.2% Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 56

58 The Impact Of The Recession On The Entrepreneurial Composition Of The United States By Region, Population Group And Minorities Table 5 Measures of Entrepreneurial Activity by White/Caucasian and Non-White/Caucasian Involved in Any Kind of Entrepreneurial Activity Involved in Total Early- Stage Entrepreneurial Activity Involved in Opportunity Early-Stage Entrepreneurial Activity Involved in Necessity Early-Stage Entrepreneurial Activity Actively Involved in Start-Up Effort; Owner, No Wages Yet Manages and Owns a Business That is Up to 42 Months Old Manages and Owns a Business That is Older Than 42 Months Shut Down a Business in the Past 12 Months YEAR CAUCASIAN NORTHEAST MIDWEST SOUTH WEST UNITED STATES NON- CAUCASIAN CAUCASIAN NON- CAUCASIAN CAUCASIAN NON- CAUCASIAN CAUCASIAN NON- CAUCASIAN CAUCASIAN NON- CAUCASIAN % 35.8% 20.7% 43.1% 27.9% 32.2% 34.8% 35.6% 27.1% 35.3% % 29.2% 21.3% 18.1% 25.4% 28.9% 25.6% 31.0% 24.2% 28.3% % 9.3% 6.0% 18.7% 8.7% 9.4% 11.3% 9.6% 8.4% 11.0% % 9.0% 4.6% 7.4% 8.2% 7.9% 6.9% 8.7% 6.5% 8.2% % 6.5% 5.3% 17.9% 6.6% 6.5% 10.1% 7.2% 7.0% 8.5% % 6.1% 2.5% 5.3% 6.1% 5.1% 4.5% 7.1% 4.5% 5.9% % 2.8%.2% 0% 1.6%.6%.6% 2.4%.9% 1.3% % 3.0% 1.7% 0% 1.7% 2.0% 2.0% 1.2% 1.6% 1.6% % 7.5% 2.9% 14.6% 5.2% 6.7% 4.4% 4.8% 4.3% 7.6% % 9.0% 3.1% 7.4% 4.1% 5.9% 4.3% 6.0% 3.8% 6.5% % 1.9% 3.1% 4.1% 3.5% 2.3% 6.9% 5.3% 4.2% 3.3% % 0% 1.6% 0% 4.2% 2.2% 2.7% 4.0% 2.8% 2.2% % 9.3% 7.1% 5.7% 8.4% 4.4% 8.8% 10.0% 8.1% 6.8% % 2.0% 5.5% 0% 6.6% 2.3% 7.8% 2.8% 6.4% 2.1% %.9% 1.8% 1.6% 3.0% 3.2% 2.2% 3.8% 2.4% 2.9% % 0% 1.9% 0% 2.8% 1.1% 3.1% 2.8% 2.4% 1.4% Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 57

59 The Impact Of The Recession On The Entrepreneurial Composition Of The United States By Region, Population Group And Minorities Table 6 Entrepreneurial Activity by Gender NORTHEAST MIDWEST SOUTH WEST UNITED STATES YEAR MALE FEMALE MALE FEMALE MALE FEMALE MALE FEMALE MALE FEMALE Involved in Any Kind of Entrepreneurial Activity Involved in Total Early- Stage Entrepreneurial Activity Involved in Opportunity Early-Stage Entrepreneurial Activity Involved in Necessity Early-Stage Entrepreneurial Activity Actively Involved in Start-Up Effort; Owner, No Wages Yet Manages and Owns a Business That is Up to 42 Months Old Manages and Owns a Business that Is Older Than 42 Months Shut Down a Business in the Past 12 Months % 21.8% 28.9% 17.8% 30.3% 26.0% 39.4% 29.0% 32.3% 24.0% % 20.6% 24.3% 18.2% 31.1% 21.1% 33.4% 21.4% 29.8% 20.4% % 5.4% 9.5% 4.9% 7.6% 9.8% 13.1% 8.8% 9.8% 7.6% % 4.3% 5.1% 4.4% 11.0% 5.4% 9.5% 5.7% 8.8% 5.0% % 4.3% 9.0% 4.3% 7.4% 5.3% 12.0% 6.9% 9.1% 5.2% % 3.2% 2.1% 3.4% 8.4% 3.6% 5.6% 4.6% 6.0% 3.7% % 1.1% 0.2% 0.2% 0.2% 2.8% 0.5% 1.5% 0.4% 1.6% % 0.9% 2.1% 1.1% 2.3% 1.1% 2.8% 0.7% 2.3% 0.9% % 3.2% 5.5% 2.9% 4.6% 6.2% 6.3% 2.9% 5.4% 4.2% % 3.2% 3.8% 3.0% 6.2% 2.7% 6.0% 3.3% 5.6% 3.0% % 2.4% 4.2% 2.0% 2.9% 3.6% 7.0% 6.1% 4.5% 3.5% % 1.3% 1.1% 1.4% 4.8% 2.7% 4.2% 2.4% 3.5% 2.1% % 6.0% 8.7% 5.3% 9.4% 5.4% 9.8% 7.7% 9.3% 6.0% % 3.7% 6.2% 4.1% 6.7% 4.7% 7.9% 5.5% 6.9% 4.6% % 1.3% 2.0% 1.4% 3.3% 2.9% 3.0% 2.3% 2.8% 2.1% % 0.6% 1.7% 1.6% 2.8% 2.3% 3.7% 2.4% 2.5% 1.9% Source: GEM United States Adult Population Surveys (APS) 58

60 The Impact Of The Recession On The Entrepreneurial Composition Of The United States By Region, Population Group And Minorities Table 7 Measures of Entrepreneurship Attitudes Based on Size of Firm NORTHEAST MIDWEST SOUTH WEST UNITED STATES TEA TOTAL EARLY-STAGE ENTREPRENEURS EB- ESTABLISHED ENTREPRENEURS CURRENT JOBS CURRENT JOBS CURRENT JOBS CURRENT JOBS CURRENT JOBS YEAR TEA: Expects to Start-Up in the Next 3 Years: % Yes % 0.0% 11.1% 0.0% 25.8% 100.0% 21.2% 25.0% 21.7% 60.0% EB: Expects to Start-Up in the Next 3 Years: % Yes % 22.2% 14.9% 42.9% 7.2% 3.4% 13.0% 17.6% 11.2% 14.5% TEA: Believes Starting a Business Is Considered a Good Career Choice: % Yes EB: Believes Starting a Business Is Considered a Good Career Choice: % Yes TEA: Starting a Business Now Compared to One Year Ago: % More Difficult TEA: Growing a Business Now Compared to One Year Ago: % More Difficult TEA: Effect Global Economic Crisis: %Fewer Business Opportunities EB: Starting a Business Now Compared to One Year Ago: % More Difficult EB: Growing a Business Now Compared to One Year Ago: % More Difficult EB: Affect Global Economic Crisis: % Fewer Business Opportunities % 100.0% 60.0% NA 71.8% NA 76.5% 100.0% 64.9% 100.0% % 66.7% 56.3% 100.0% 70.3% 72.7% 62.1% 33.0% 65.3% 61.5% % 100.0% 50.0% 0.0% 58.4% 20.0% 64.3% 100.0% 58.2% 55.6% % 0.0% 50.0% 100.0% 48.5% 0.0% 36.3% 33.3% 40.6% 20.0% % 0.0% 43.8% 100.0% 63.6% 60.0% 45.5% 66.7% 56.2% 66.6% % 85.7% 78.3% 57.1% 73.9% 82.8% 75.5% 78.9% 75.6% 78.7% % 44.4% 64.6% 37.5% 49.3% 32.2% 56.3% 66.6% 55.3% 43.8% % 66.6% 74.5% 50.0% 67.2% 60.7% 67.3% 66.7% 68.0% 62.5% Source: GEM U.S. Adult Population Survey Source: GEM United States 2009 Adult Population Surveys (APS) 59

61 The Impact Of The Recession On The Entrepreneurial Composition Of The United States By Region, Population Group And Minorities Table 8 Industry Distribution by Early-Stage and Established Business Owner Entrepreneurs NORTHEAST MIDWEST SOUTH WEST UNITED STATES EARLY- STAGE ESTABLISHED BUSINESS OWNER EARLY- STAGE ESTABLISHED BUSINESS OWNER EARLY- STAGE ESTABLISHED BUSINESS OWNER EARLY- STAGE ESTABLISHED BUSINESS OWNER EARLY- STAGE ESTABLISHED BUSINESS OWNER YEAR % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION % WITHIN REGION Extractive Transforming Business Services % 5.3% 1.4% 21.1% 3.3% 10.6% 6.1% 11.2% 3.7% 11.8% % 12.8% 5.8% 23.6% 7.0% 5.0% 7.1% 13.0% 6.0% 12.1% % 22.7% 23.6% 19.7% 17.3% 19.7% 28.9% 20.2% 22.2% 20.4% % 19.1% 21.2% 20.0% 22.5% 28.7% 30.6% 35.1% 24.4% 27.1% % 36.0% 41.7% 31.6% 39.3% 34.8% 37.7% 37.1% 38.3% 34.9% % 27.7% 19.2% 25.5% 31.7% 29.7% 29.4% 22.1% 28.6% 26.4% Consumer % 36.0% 33.3% 27.6% 40.0% 34.8% 7.2% 31.5% 35.9% 32.8% Oriented % 40.4% 53.8% 30.9% 38.7% 36.6% 32.9% 29.9% 41.1% 34.3% Source: GEM U.S. Adult Population Survey Source: GEM United States 2008 and 2009 Adult Population Surveys (APS) 60

62 6 Financing SMALL BUSINESS LENDING INFORMAL INVESTING 61

63 Financing VENTURE CAPITAL 62

64 Financing Figure 41 Venture Capital IRR and Total Amount Raised by VC-Backed IPOs Total Raised by VC-Backed IPOs, $ Millions 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, Venture Capital IRR, % % -22% Amount of IPOs CPI Adjusted VC IRR % Source: National Venture Capital Association 63

65 Financing Figure 42 Venture Capital Investments in Clean-Tech in United States $1,000, Data source: National Venture Capital Association Yearbook,

66 7 Public Policy In The United States IMPACT OF ECONOMIC DECLINES ON ECONOMIC ACTIVITY 5 The NBER does not define a recession in terms of two consecutive quarters of decline in real GDP. Rather, a recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production and wholesale-retail sales. For more information, see the announcement from the NBER s Business Cycle Dating Committee, dated 12/01/08. 65

67 Public Policy in the United States Figure 43A U.S. Entrepreneurial Trends with Real GDP 12.0 % 10.0 % Percentage Entrepreneurial Activity 8.0 % 6.0 % 4.0 % 2.0 % Early-Stage Entrepreneurial Activity (18-99 pop.) Change in Real GDP Changes in #Nonfarm Employees 0.0 % -2.0 % -4.0 % Years Sources: 1) Early Stage GEM; 2) Real GDP Bureau of Economic Analysis 3) #Nonfarm employees Bureau of Labor Statistics 66

68 Public Policy in the United States Figure 43B Percent Changes: U.S. Real GDP and Key Components Percent Changes: U.S. Real GDP and Key Components %Change Year over Year Gross Domestic Product Personal Consumption Expenditures Services Gross Private Domestic Investment Investment Nonresidential Investment Residential Exports Imports Source: U.S. Bureau of Economic Analysis Gross domestic product Personal consumption expenditures Services Gross private domestic investment Investment Nonresidential Investment Residential Exports Imports 67

69 Public Policy in the United States Table 9 U.S. Percentage Growth Rates by Industry INDUSTRY All Agriculture and Related Industries Nonagricultural Industries: Mining Industry Construction Industry Manufacturing Industry Wholesale Trade Industry Retail Trade Industry Transportation and Utilities Industry Information Industry Financial Activities Industry Professional and Business Services Education and Health Services Industry Leisure and Hospitality Industry Other Services Industry Public Administration Industry Source: United States Bureau of Labor Statistics Employment Levels by Industry. U.S. recession occurred from March November 2001 U.S. recession began in December Until the official date is announced, July 2009 (the third quarter) is used as an estimate for the end of the recession (Source: Minneapolis Federal Reserve Bank). 68