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Can't land a job? Create your own

McClatchy Tribune Wire Service

Published: May 24, 2009

They've left big salaries for uncertain wages and traded corner offices for garages and spare bedrooms.
As the recession has made layoffs common and job openings scarce, more workers are replacing the corporate world with the freedom -- and risks -- of starting their own businesses.

Many say they're drawn because of the earning potential, the chance to be their own boss and the opportunity to follow a dream. Others are starting a business because they've lost their job or fear a layoff is imminent.
"There's a significant contraction, especially in six-figure jobs," said John Brader of Focus Four Inc., a coaching firm that advises business owners. "There's less opportunity to go into those jobs right now. It's waking a lot of people up."

Brader, who started the firm after a two-decade corporate career, has lunch several times a week with workers, particularly bankers, toying with the idea of starting a business. Many clients have launched new ideas even before leaving their old jobs, just in case, and a new company program that counsels budding entrepreneurs has been a hit, he said.

The number of people creating new businesses rose nationally last year as the recession deepened, according to a study released this month.

The Kauffman Foundation study showed an increase in new ventures with lower-income earning potential, such as child care and retail services, suggesting people are creating jobs more out of necessity to make living than out of a great business opportunity.

In Mecklenburg, 205 new businesses were created in April, slightly more than in March, though that activity was down 16 percent the first four months of this year over the same period last year.

Starting a new business involves serious risks, experts warn. About a third of businesses fail within the first two years, and nearly 70 percent fail within seven years, according to SCORE, a nonprofit organization that helps launch small businesses.

Thanks to the recession, it's difficult to get loans, and consumers aren't spending as much as they did in better times.

Yet new business owners say the payoff can make it worthwhile.