Inflation, a chaotic stock market and increasing reports of layoffs might have some service members worried about their near-term economic futures. Those who are still in the military but looking to transition soon might consider starting their own business to weather the financial storm.
Many Americans, veteran and non-veteran alike, did just that in the past year. According to Gusto, the payroll management company, 2021 saw 5.4 million new business startups in the United States, the highest recorded since the Census began gathering business formation statistics in 2012. Leading the way among the millions were new veteran entrepreneurs.
The new report showed that 10.7% of all new business owners in America were veterans, citing a 100% increase in the number of veteran-owned businesses from the last year Census data was collected.
Gusto's Survey of New Business Owners asked veterans why they decided to start their own businesses, rather than pursue other avenues of income. Unsurprisingly, 48% of respondents said they were worried about their financial situation. Other responses were based on some sort of economic need, such as layoffs and child-care costs.
Veterans are already a naturally entrepreneurial subset of the U.S. population. Previous studies have shown that vets are 45% more likely to start their own businesses than their non-veteran counterparts.
The Survey of New Business Owners found that this entrepreneurial spirit is emerging in the wake of the global pandemic, as a quarter of respondents reported their startup is taking advantage of a pandemic-related business opportunity.
There were also a variety of industries in which vets chose to start their new enterprises. Forty-seven percent of these businesses were either producing consumer goods or were in the construction, utilities, transportation and warehousing sector. Another big area was the retail, leisure and hospitality sectors, where 29% of veteran respondents started businesses.
A slew of new veteran-owned businesses is good for the economy overall. Previous Census data show nearly four million Americans were employed by veteran-owned businesses, and Gusto's new survey reveals these new businesses are looking to hire even more, despite perceived financial conditions.
Sixty-three percent of veteran-owned firms said they would hire more employees in 2022, and 71% said they would look for help in the coming year. So while media headlines may make things look bleak for some, namely the tech sector, small businesses -- especially those run by veterans -- continue to spur economic growth across the country.
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