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When the economy tanked, both existing jobs and the promise of creating more faded with it. Thousands of people with "job security" were laid off only to find that companies weren't hiring, or weren't willing to pay for their 15 years of experience.
So the workforce got creative. Those who had been harboring secret hatred for their cubicles decided to look on the bright side. They jumped off the corporate ladder willingly. Many gathered up their talent and their networks, and went into business for themselves. After all, if your future's going to be uncertain, shouldn't you at least get to hold the reins?
According to the most recent BLS data, between 8-10 percent of all working men and women in the U.S. are self-employed. Although big corporations usually garner all the praise for job creation, new research shows that it's actually these freelancers, contract workers, and self-starting entrepreneurs who are making a difference in small local economies.
A study by Stephan Goetz, professor of agricultural economics and regional economics at Penn State, found that the number of self-employed workers in nonmetro American counties significantly predicted personal income and job growth, as well as declines in family poverty levels.
“We often look at self-employment as a stopgap measure, something done out of desperation,” Goetz says. “But, in fact, self-employment has a tangible effect in raising income growth and lowering poverty.”
During his research, Goetz, along with associate Anil Rupasingha, examined statistics from the Bureau of Economic Analysis on self-employed rates in 3,000 metro and nonmetro counties. They found that between 1969 and 2009, the number of the self-employed in nonmetro areas has risen from 2.9 million to 5.6 million, an increase of 93 percent. When analyzed in relation to economic trends over the past few decades, it was discovered that self-employment helped drive positive growth in these communities.
Of course, self-employment isn't completely fail-proof. Just like brick and mortar businesses, the self-employed depend on demand for their goods or services, and can be affected by economic downturns, though not as severely.
That's why coworking spaces, especially in rural areas, are so important. Yes, as Goetz found, self-employment can revitalize and empower local economies. But who empowers and supports the self-employed? The global coworking community, that's who.
Goetz says to encourage growth, leaders should help the self-employed by organizing networking meetings and alerting them to exporting opportunities. "Economic development groups also can assist entrepreneurs with credit and grant applications," he explains.
Or, those same government leaders could help plant coworking spaces in their communities. Shared office spaces are the perfect, fertile mix of business incubator, think tank, professional network, therapy group, all rolled into one.
Freelancers and small business owners have been shown to thrive when exposed to the open sharing that occurs in coworking communities, and the coworking spaces themselves are small businesses that can act as lightning rods for innovation and economic growth.
If you're interested in learning more about what coworking can do for self-employed workers in rural areas, check out these Shareable posts:
Comments
Narayan wrote on 07.09.12, 8:22pm:
Rural Self Employed in core fields like food and textile ,building material are much scope to enter and exist . This takes the innate creative talent . This talent was denied for last 250 years . We are all just fish out of illusion water, unlearn this old swimming and re learn in scales ,laws ,and rules of nature. We have survived 5 generation of illusion rich mad man living style.
Ordinary job is made tough ,easy living is made complicated .We are all fish out of water. Inward exploiting nature is plenty and possible ,anything else is reinventing wheel .
Tie
Jenna Weiner wrote on 07.10.12, 10:53am:
Great article! We're seeing the same pattern of contracting making a huge impact in small local economies, and are starting to visualize these impacts in our 'oConomy': https://www.odesk.com/blog/2012/07/visualizations-of-odesk-oconomy/ Really, contractors are taking advantage of the fact that (due to technology) there is no longer a need for workers to be within commuting distance. It's about bringing the work to the workers, not the other way around. And smart workers are taking advantage of this to build not only their careers, but their own businesses. These businesses rise above geographic constraints, providing new freedom and opportunity to work where they want, how they want, on the work of their choosing while also fueling the economy.
Beth Buczynski wrote on 07.10.12, 2:01pm:
Thanks for reading and for sharing the great data visualizations, Jenna!
Trond Marius wrote on 07.11.12, 9:12am:
As an owner of a small web shop I do relate to this article. It's tough to start up and the pay is not much to brag about, but the feeling of working for myself and not a rich company is priceless.
I believe the world needs more small companies that care more about the community and workers than squeezing the last cent of profits. And local trade is also good for the enviroment.
Sasha wrote on 07.18.12, 1:26am:
As someone who lives in a country which had a clinical dead economy for a decade (things just a bit better now) I can confirm: when every industry in your area dies, its the small and invisible micro business that saves you and keeps you above. Do not wait to be laid out, its much harder then.
Self employed myself; although that was long before the current financial crisis. Know of two friends who were recently laid off and started ebay businesses which, although not thriving, are bringing in enough to cover their monthly bills/morgage etc.