The U.S. job market continues to be uncertain as we head into the fourth quarter of 2020. According to Bureau of Labor Statistics data from September, the unemployment rate has increased by 11.4 million. However, the job market for unemployment still linger well below highs from February.
The job market instability has U.S. workers turning to new forms of income. Americans are becoming entrepreneurs at unprecedented rates. COVID has undoubtedly shaped this rise in entrepreneurs. This is to be expected, since times of financial crisis often give birth to major American companies.
There is, however, much for budding entrepreneurs to learn when starting their path to independent revenue. For instance, an entrepreneur needs to know how to set up a business, and have marketing and SEO best practices to build a digital presence.
And digital is the new in-store experience more now than ever before as COVID guidelines impact brick and mortar businesses. But to many entrepreneurs, especially entrepreneurs ready to tackle the digital space, can start and grow a business during an economic downturn.
Is Starting A New Business During The Current Pandemic A Good Idea?
Starting a new business during economic uncertainty may sound like a bad idea. But as the job market continues to stutter step toward normal employment rates, the timing may be good at the moment.
There are a ton of new businesses forming during the COVID pandemic. Yes, rates of new businesses have been a bit slower than normal. Business applications are at a 43 percent change with over 81,000 new business applications, according to the United States Census Bureau.
Entrepreneurs that are gearing businesses toward pandemic solutions are finding growth opportunities. And economic downturns have proved good times to start businesses in the United States in the past.
For instance, Airbnb was founded in 2008, during the country’s housing market crash. This highlights the creativity of entrepreneurs to utilize current economic situations in order to start and grow a viable business.
Disney is another example of business opportunity during times of U.S. economic uncertainty. Disney was founded in 1923, after a period of depression that lasted from 1920 to 1921. General Motors, Slack, Uber, Hewlett-Packard, and other household name companies were also started during economic and job market strife in the U.S.
Entrepreneurs Have Advantages During Economic Uncertainty And Job Market Lows
There are two primary reasons why starting a business during troubling economic times makes sense. The first is having access to more resources. The other reason is the ability to find new solutions to new problems.
Entrepreneurs that keep these two motivators at the forefront can certainly carve out a space in nearly every market, despite COVID. The downturn in the job market can also be seen as an advantage for budding business owners. How? There are more highly-qualified candidates to choose from. And getting top talent on your payroll can also be more cost-effective as the job market attempts to gain traction.
Starting A New Business Amid Pandemic Actually Makes Financial Sense
This may seem out of sorts, but starting a new business as an entrepreneur makes financial sense during the current COVID pandemic. Why? There’s greater access to investors and funding across the board.
There are unprecedented low interest rates for founders borrowing money at the moment. This can give entrepreneurs access to serious startup capital at a rate that is in favor of the borrower. Renting office, warehouse, and even kitchen space is cheaper than normal due to COVID.
Landlords are eager to rent spaces for a very low monthly price, during the pandemic. For instance, there has been a rise in leasing and subleasing kitchen space to fuel the carry-out and delivery surge the pandemic has brought on. Entrepreneurs serving up these kinds of solutions are seeing serious revenue for their startups with very low overhead.
Identifying current consumer needs and filling the gap as an entrepreneur during these uncertain economic times, especially with the job market stagnant, can prove profitable. And leveraging benefits like low interest loan rates and cheap rental space is how to ensure a new business stays out of the red.
Can Entrepreneurs Capitalize During The COVID Pandemic?
Entrepreneurs can absolutely find viable business ideas during COVID times. Whether the business idea solves a COVID problem, or has nothing to do with pandemic consumer woes, this may be an ideal time to be an entrepreneur. Having the ability to continue the business post-pandemic will be the big question in months to come.