Spurred by the economic disruption and emotional disclocation brought about by the pandemic, more people turned to entrepreneurship in 2021 than in any year for the last 20.
Data released Jan.12 by the U.S. Census Bureau reveals that 5.4 million business applications were filed in 2021, a record amount since the bureau began collecting data in 2004. That’s 1 million more applications than the previous record of 4.4 million in 2020.
The surge could flatten or reverse itself. Entrepreneurship in the United States has been on a long, slow decline for the past 40 years.
Making The Leap
But, led by women and people of color – who show the fastest growth rates – more people are cobbling together livelihoods in the creative and gig economies; with some emerging into employer businesses. The U.S. government is recognizing the trend and broadening its data systems – the U.S. Census Bureau began counting more solopreneurs as businesses – and its tax structure to focus on these emerging companies. Starting Jan. 1, the IRS is requiring companies such as Venmo and Paypal to report transactions over $600, significantly less than the previous minimum of 200 transactions totalling $20,000.
An increasing number of people see a more fulfilling future in careers that offer more control and a way to follow their passions. Take Danielle Neal, a Baltimore-based entrepreneur who launched her business Digital with Danielle in 2020. When she started it was essentially a side hustle to offer social media marketing services to business owners. The 25-year-old worked full-time as a teacher. In 2021, she decided to take the leap into entrepreneurship full-time.
She describes her feelings as a “bowl of spaghetti.” She understood the risk, but social media marketing and education was a passion and something she knew she’d excel at.
“I noticed if I didn’t do this for myself, I couldn’t be an inspiration to the students that I served, and I wanted the students to see that you don’t have to be locked into what people say, essentially,” she said. “You don’t have to be locked into the normal path.”
Now, she brings in about $6,000 a month, working with three clients each quarter to develop social media strategies to grow their businesses and audience. She’s working on applying for government and business grants to keep growing.
WATCH THE FULL INTERVIEW: Why a 25-Year-Old Baltimorean Left Teaching to Follow A Talent for Digital Marketing
This story and others on Times of E are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit www.kauffman.org and connect with www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn.