Thursday, February 2, 2017

Business Startups Concentrated In Fewer Cities

From The Wall Street Journal, "The Five Megacities Where Business Startups Have Boomed: New York, Miami, Los Angeles, Houston and Dallas house half of new businesses created after the recession" by Janet Adamy:
Consider that in the mid-1980s, 29 metropolitan areas that contained 45% of the country’s jobs were home to half of the national increase in companies after an earlier recession.

Now look at what happened after the painful 2007-09 economic downturn. The aforementioned five metro areas [New York, Miami, Los Angeles, Houston and Dallas] housed half of the nation’s net increase in new firms and accounted for 17% of employment between 2010 and 2014. Left behind are thousands of small towns and rural areas that stitch together much of America.

Source: The Wall Street Journal

Economists say this is particularly worrisome because it is businesses starting from scratch—and not older companies—that are the primary drivers of job growth. Even after the economy was five years into its recovery from the latest recession, three out of five metropolitan areas were seeing more firms close than open.

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