Oregon lags nation in business start-ups

by NW Spotlight

Businesses start-ups at an all-time low (in Oregon and nationally)

Yesterday’s Oregon Economic and Revenue Forecast from the State of Oregon’s Department of Administrative Services, Office of Economic Analysis, contains a chart showing that Oregon lags the nation in business start-ups. The forecast also notes that business start-ups are at an all-time low, in Oregon and across the nation.


click to enlarge

On page 18, in the section on extended economic outlook, the forecast states:

Another area of potential concern that may impact longer term economic growth is that of new business formation. Over the past year or two, the number of new business license applications with the Oregon Secretary of State have begun to grow again and even accelerate. However data available from the U.S. Census Bureau and Bureau of Labor Statistics clearly indicate that entrepreneurship and business formation remain at subdued levels and rates.”

The share of all businesses that are start-ups, either in Oregon or across the nation, is effectively at an all-time low, with data starting in the late 1970s. Associated start-up employment follows a similar pattern. The concern is that new businesses are generally considered the source of innovation and new ideas, products and services that help propel economic growth. To the extent that lower start-up rates indicates that R&D more broadly is not being undertaken, slower growth is to be expected moving forward. However, if the larger firms that have won out in today’s marketplace are investing in R&D and making those innovations themselves, then the worries about the number of start-ups today is overstated. It can be hard to say which is the correct view. However seeing these longer run, downward trends in new business formation warrants, at the very least, concern about future growth prospects.

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Posted by at 06:00 | Posted in Economy, Employment, Jobs | 2 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Bob Clark

    The Oregon income tax I should think is unattractive to small entrepreneurs, as usually they are taxed at the personal income rate. A sales tax replacing income tax in totality and constitutionally might help spur the entrepreneur. Have to look at Washington to see if business creation is at a faster pace relative to population. I am too busy to look.

    • thevillageidiot

      There has never been a tax that spurred business. Washington has never created new business nor made the environment for new business better. New businesses were created when taxes and regulations were the same for everyone not just conducive to mega-corps. Who are you and what did you do with Bob?
      Taxes of all types hinder creation of new business (less savings to start a new business). Regulations and licensing hinder new start ups and new business (more regulatory rules to meet before starting a new business). Why do you look to Washington or even Salem for creation of new business.

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