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Hire one testimony v2

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slides re testimony to Idaho Senate re Hire One Act (supporting)

slides re testimony to Idaho Senate re Hire One Act (supporting)

Published in: Business, Career

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  • 1. Growing resilient, self-renewing local economies: How Hire One Can Help Entrepreneurship: THE Key to Job Creation Idaho Senate Local Government & Taxation Committee Norris Krueger, PhD March 2011 [email_address] 208.440.3747 @entrep_thinking
  • 2. Are you surprised? Record levels of job NON-creation In 2009, we hit a 29 Year LOW in job creation; we've got a loooong way to go unless we can light a fuse
  • 3. Where do jobs come from?
    • Net job creation =
        • Jobs Created minus Jobs Lost
    • Which is more important? Aren't they equally important?
    • It's job creation that drives the boat...
    • And “churn” is healthy
    • Shouldn't we ask WHO creates the jobs?
    • And shouldn't we help them ?
  • 4. 58-40 or Fight?
    • Gross job creation – only three sources:
    • Businesses moving in
    • Businesses growing
    • Businesses starting
    • They contribute 2%, 40% & 58% of gross job creation
  • 5. Yes, in THAT order
    • Startups create 58% of new jobs (gross)
    • Expanding firms create 40%
    • [In-migrant firms only 2% ]
    • BUT... what about NET job creation?
    • Startups – Business Exits = ~10% of net jobs
    • Growing firms – Shrinking firms = ~90%
    • Implication: Growing firms matter (so do startups, especially with growth potential)
      • (shall we look at Idaho's numbers?)
  • 6. Where Did Idaho's Jobs Come From? (2000-2007)
    •   New businesses created around 297,000 jobs [58%]
    • Expanding businesses created around 200,000 jobs [40%]
    • Businesses moving in created around 10,000 jobs. [2%]
    •   but now… let's look at the net job figures:
    • Businesses opening: created 296,983 jobs
    • Businesses closing: destroyed 291,824 jobs
    • Net jobs from business creation: +5,519 jobs [8%]
    •   Business expansions: created 200,383 jobs
    • Business contractions: destroyed 133,502 jobs
    • Net jobs from business expansion: +64,781 jobs [92%]
    •   Businesses moving into Idaho: created 10,555
    • Businesses moving out of Idaho: destroyed 10,757
    • Net jobs from business attraction: -202 jobs
    • (1977-2005, the US created 450 million jobs & lost 406 million jobs)
  • 7. Every economy needs a steady in-flow of job-creating businesses
  • 8. Note the gap between the lines in 2009 vs 2001...and the plummet in job creation from 2005 onward Opportunity Entrepreneurship declining since 2005 Necessity entrepreneurship at or near record levels
  • 9. Starts and Terminations of Employer Businesses Source: Office of Advocacy, SBA
  • 10. Outlook for Expansion Percent Next Three Months “Good Time to Expand” January Quarter 1974 to January Quarter 2011 Again, a long way to go, why not a nudge?
  • 11. Good Time to Expand 2008/09 Recession Compared to Other Recent Recessions
  • 12. EMPLOYMENT Planned Next Three Months and Current Job Openings January 1986 to September 2010 (Seasonally Adjusted)
  • 13. So what can we do?
    • Look for who is bucking the downtrend:
      • What are the successful cities & states doing?
    • Look at proven practices
    • DO what successful states do
    • USE the proven practices
    • Integrate with our own positives
      • How does Hire One fit in?
      • (How does Project 60 fit in??)
  • 14. Focus on GROWTH firms (“gazelles”) - but see which is lowest on gazelles?
  • 15. Three Keys to Growing Entrepreneurial Communities
    • From the Global Entrepreneurship Monitor (GEM, over 10 years of study;~80 countries)
    • #1 People believe they are personally prepared to be entrepreneurs – they SEE themselves as truly entrepreneurial.
    • #2. Local social & cultural norms are seen as supportive
    • #3. Ease of doing (& starting) business
  • 16. Hire One
    • Regardless of any direct $ impact, imagine the signal to growth-oriented entrepreneurs that Idaho supports them.
    • (But the signal must be credible, of course)
    • Hire One could also contribute to the #3 predictor of entrepreneurial activity (ease of doing business)
  • 17. Project 60
    • Includes “systemic”, “organic” growth as key component – a positive signal for #2 (social/cultural norms)
    • The Governor's Summits focused extensively on #3 (ease of doing business)
    • We still need strategy & tactics to promote the #1 predictor, the “entrepreneurial” component.... but we know how to do that (and it need not cost much at all )
  • 18. Hire One as First Step?
    • A limited tax credit rewarding Idaho entrepreneurs for growing will likely have positive impacts, especially psychologically
    • Telling entrepreneurs we appreciate them cannot hurt unless. ..
    • Entrepreneurs and citizens see it as a 'band-aid' or, worse, a token gesture
    • So how does Idaho avoid that?
    • “ Walk the walk”... create that strategy
  • 19. Quick Overview: How to Grow a More Entrepreneurial Idaho
    • Never miss the opportunity to be supportive
      • The “Bully Pulpit”
    • Comprehensive strategy – broad AND deep
      • Broad : in every corner of the state, in every industry
      • Deep : focus on where we are (or will) compete the best
    • Start with the Low Hanging Fruit (cheap, easy)
      • And... Isn't Hire One exactly that?
  • 20. Examples of Low Hanging Fruit
    • Hire One inspires( us to look at more “tiles” to build our entrepreneurial, job-creating “mosaic”!)
    • Policy Briefings: Share with opinion leaders, civic officials, media & taxpayers how we really grow jobs
    • Task Force: Marshal Idaho's own best & brightest to implement Idaho's killer comprehensive entrepreneurship strategy
    • The Bully Pulpit: Preach the job creation 'gospel'! (and “walk the walk” with Hire One !)