Americans still want to be their own bosses and start a business, but they are intimated by the overall economy and its slow recovery, a new study shows. Reflecting that uncertainty, only a quarter of those wannbe bosses are actually trying to a start up a business.
More than 56 million (24 percent) U.S. adults would like to start their own business, but only 14 million (6 percent) are currently trying to do so, according to a national survey of more than 2,000 Americans conducted by Harris Interactive. The survey was sponsored by borro, a personal asset lender.
This doesn't bode well for the continued health of the economy since there is a direct correlation between small business growth and overall economic recovery, borro said.
The state of the economy appears to be a key reason behind the slowdown in startups, the survey found. Although 91 percent of Americans agree that small businesses are important to economic recovery, more than half (56 percent) blame the slowdown on the economy. Nearly 155 million Americans (66 percent) said they would not want to start their own business right now because of the economic climate.
Those 14 million individuals who are currently trying to start their own business face an uncertain future in terms of financing, the survey found. More than 5.6 million (40 percent) of them report they are having difficulty finding startup financing.
"Many entrepreneurs are seeking opportunities but are being met with stringent requirements from banks and other traditional lenders that disable their dreams,” said Paul Aitken, borro CEO. "Because the economy is on shaky ground, banks are reluctant to loan money. Meanwhile, small businesses are crucial to stimulating the economy; it’s a cycle that is hard to break but does provide companies like borro with a unique value proposition to small businesses and entrepreneurs."