Help entrepreneurs find paths to success in the pandemic
A recent Wall Street Journal article opens with this line: “The coronavirus destroyed jobs. It also created entrepreneurs.”
Although the economy has struggled throughout the pandemic, the challenges have opened up new opportunities for some, as well.
“As horrible as [the pandemic] is, and as badly as it has affected so many people, it has pushed people to come up with new ideas and products and services,” said Steven Hamilton, an economist at George Washington University.
The article points out that while “it isn’t uncommon for workers who lose jobs in economic slumps to turn to self-employment as a stopgap…Once hiring conditions improve, many switch back to payroll position.” But for many, this economic slump has been different.
Many—especially in personal service industries—have found that their old jobs haven’t recovered, so some have quit working for someone else, and focused on expanding on their own personal businesses.
Some economists are suggesting that we may be moving to a new model for workers in some industries—away from the employee model, and toward a more self-employed entrepreneur model.
“A working hypothesis is that individuals realize that the new normal is going to be different from the old normal,” said John Haltiwanger, an economist at the University of Maryland who studies the Census Bureau data. New entrepreneurs “are engaging in activity that is associated with that new structure,” he said.
One of the best ways that the state can help these entrepreneurs succeed is by staying out of the way. Whether it’s hairdressers who decide to provide mobile services, people who provide local delivery services, or personal trainers who work with their customers online, the state can and should let the entrepreneur and customer decide on how best to serve and be served.
Reducing the scope of regulation generally—and occupational regulations—should be something that every policymaker is considering to let the “new normal” start thriving, and continue to thrive well into the future.