KAUFFMAN FOUNDATION SURVEY OF ENTREPRENEURS

1
KAUFFMAN FOUNDATIONSURVEY OF ENTREPRENEURS

• September 2009

2
Kauffman Foundation Survey of Entrepreneurs
Introduction and Methodology

• The purpose of this poll is to assess the
  feelings of entrepreneurs about the state of the
  economy, government and business, and current
  economic policies.
• Pollster Doug Schoen interviewed more than 250
  entrepreneurs and 150 would-be entrepreneurs
  from Sept. 8 to Sept. 12, 2009
• An entrepreneur was defined as someone who has
  started a business and is currently running it.
• A would-be entrepreneur was defined as someone
  who would like to start a business.
• The following findings reflect responses from
  entrepreneurs

3
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• Entrepreneurs and small businesses continue to
  struggle despite increasing optimism on Wall
  Street.
• About one-third of entrepreneurs say they have
  lost jobs in the past year.
• 55 of entrepreneurs say that their business has
  decreased in volume.
• 61 of entrepreneurs say that the profitability
  of their company has decreased.

4
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• Entrepreneurs want government to pursue a
  fundamentally different approach than what it is
  pursuing now, and they want the government to
  take steps to encourage entrepreneurship.

5
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• Entrepreneurs want policies that cut payroll
  taxes and fix health care. They are most afraid
  of the government raising the debt and the
  deficit.
• 46 believe that the stimulus has hurt the
  economy, and three-quarters are against another
  economic stimulus.
• A majority (53) believe that the stimulus
  package itself hurts entrepreneurial activity.

6
Kauffman Foundation Survey of EntrepreneursOvervi
ew of Findings

• Entrepreneurs believe that the economy is heading
  in the wrong direction (61).
• They believe that the economy is getting worse
  (59), not better, by a substantial margin. They
  believe that the economy is not beginning to
  recover (68).

7
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• Entrepreneurs think it is critically important
  for government to make it easier to start a new
  business.
• They think that the laws in America make it more
  difficult to start a new business (35).
• 82 are concerned about taxes increasing, while
  61 are very concerned.

8
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• 92 think that entrepreneurs are central to
  creating new jobs.
• Over half of entrepreneurs (53) feel that the
  United States does not do enough to encourage
  entrepreneurship. 58 say that more should be
  done to encourage entrepreneurship.

9
Kauffman Foundation Survey of Entrepreneurs
Overview of Findings

• Entrepreneurs believe tax cuts (38) and
  incentives for small business (31) will
  encourage more entrepreneurial activity.
• They agree that the U.S. economy has been and
  will continue to be built by entrepreneurs (80).
  

10
Kauffman Foundation Survey of Entrepreneurs Job
Creation

• 59 of entrepreneurs say there has been no change
• 32 say they have lost jobs in the past year
• 5 say that they have created jobs in the past
  year

11
Kauffman Foundation Survey of Entrepreneurs Size
of Business

• 55 of entrepreneurs say it has decreased in
  volume
• 27 say it has stayed the same
• 9 say that their own business has increased in
  volume

12
Kauffman Foundation Survey of Entrepreneurs
Profitability of Business

• 61 of entrepreneurs say it has decreased
• 21 say it has stayed the same
• 10 say that the profitability of their company
  has increased

13
Kauffman Foundation Survey of Entrepreneurs Mood
of the Economy

• 61 of entrepreneurs say the economy is on the
  wrong track
• 30 say it is headed in the right direction
• 9 are not sure

14
Kauffman Foundation Survey of Entrepreneurs Mood
of the Economy

• 46 of entrepreneurs say their personal economic
  situation is on the wrong track
• 25 say it is headed in the right direction
• 29 are not sure

15
Kauffman Foundation Survey of Entrepreneurs
Health of the U.S. Economy

• 59 of entrepreneurs say that the economy is
  getting worse
• 35 it is getting better
• 6 are not sure

16
Kauffman Foundation Survey of Entrepreneurs
Health of the U.S. Economy

• 68 of entrepreneurs do not believe that the U.S.
  economy is beginning to recover
• 13 believe that it is beginning to recover
• 19 are not sure

17
Kauffman Foundation Survey of Entrepreneurs
Health of the U.S. Economy

• We then asked respondents to tell us how much
  longer they think the country's current economic
  recession will last a few more months, up to
  six months, up to a year, up to two years, or
  longer than that.
• 69 say it will last a year or two longer, while
  one-quarter say it will last for longer than two
  years.

18
Kauffman Foundation Survey of Entrepreneurs
Health of the U.S. Economy
19
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy

• We read respondents a series of statements about
  the U.S. economy, and asked if they strongly
  agree, somewhat agree, somewhat disagree or
  strongly disagree with each statement.

20
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy

• 90 of entrepreneurs think that the United States
  is facing a serious risk of inflation in the
  future. 80 strongly agree.
• 7 disagree.
• 80 of entrepreneurs think that the United
  States economy has been and will continue to be
  built by entrepreneurs. 56 strongly agree.
• 17 disagree.

21
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy
80 Strongly Agree
22
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy
56 Strongly Agree
23
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy

• 75 of entrepreneurs think we cannot have a
  sustained recovery from our economic crisis
  without another burst of entrepreneurial energy.
  42 strongly agree.
• 12 disagree.
• 66 of entrepreneurs think the United States is
  facing a risk for a period of long term higher
  unemployment, with the unemployment rate hovering
  around 10. 40 strongly agree.
• 28 disagree.

24
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy
42 Strongly Agree
25
Kauffman Foundation Survey of Entrepreneurs
Agree/Disagree Statements About the U.S. Economy
40 Strongly Agree
26
Kauffman Foundation Survey of EntrepreneursCreati
ng Jobs in the United States

• Next, we asked entrepreneurs to tell us how
  important big businesses, entrepreneurs,
  scientists, and the government are for creating
  jobs in the United States

27
Kauffman Foundation Survey of Entrepreneurs
Creating Jobs in the United States

• 93 say big businesses are very important for
  creating jobs
• 92 say entrepreneurs are very important
• 82 say scientists are very important
• 59 say government is very important

28
Kauffman Foundation Survey of Entrepreneurs
Creating Jobs in the United States
29
Kauffman Foundation Survey of Entrepreneurs
Creating Jobs in the United States
72 Very Important
30
Kauffman Foundation Survey of Entrepreneurs
Creating Jobs in the United States
31
Kauffman Foundation Survey of Entrepreneurs
Creating Jobs in the United States
32
Kauffman Foundation Survey of Entrepreneurs
Economic Growth

• 51 say growth in the economy has come more from
  the private sector in the past ten years, while
  34 say it has come from the public sector. 15
  are not sure.
• Entrepreneurs are split on whether public sector
  jobs create sustainable economic growth. 37 say
  that they do, while 37 say they do not. 26 are
  not sure.

33
Kauffman Foundation Survey of Entrepreneurs
Economic Growth
34
Kauffman Foundation Survey of Entrepreneurs
Economic Growth
35
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Improving the Economy

• We asked respondents what they think is the most
  important thing that the federal government
  should be doing to boost the economy.
• 34 of entrepreneurs say cut tax rates on
  payrolls and businesses
• 27 say reform the health care system

36
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Improving the Economy
37
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Business

• We then asked entrepreneurs what they think is
  the most important thing that the federal
  government could do to help them and their
  businesses.
• 55 say cut tax rates on payrolls and businesses
• 23 say reform the health care system

38
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Business
39
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Business

• And finally, we asked respondents what the
  federal government could do that would cause them
  and their businesses the most problems.
• 28 say cut tax rates on payrolls and businesses
• 16 say reform the health care system.

40
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Business
41
Kauffman Foundation Survey of Entrepreneurs Role
of Business in Improving the Economy

• We then asked respondents what they think is the
  most important role that American businesses can
  play to help us improve the economy, given the
  current economic crisis.
• 28 say they should create jobs
• 22 say they should act in ways that are socially
  responsible and do more than just maximize profits

42
Kauffman Foundation Survey of Entrepreneurs Role
of Business in Improving the Economy
43
Kauffman Foundation Survey of EntrepreneursThe
Economic Stimulus Package

• Next, we asked respondents a series of questions
  on the economic stimulus package.
• Overall, 35 approve of the stimulus package
  while 64 disapprove of it.

44
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package
45
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package

• Of those who approve of it, 25 say they do
  because it is creating jobs.
• 19 approve because it is bringing a much-needed
  boost to our economy.
• 16 say it is improving Americas infrastructure.

46
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package
47
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package

• Of those who disapprove of it, 32 say they do
  because money is being wasted.
• 30 disapprove because it is increasing the
  national debt and is putting a higher tax burden
  on our children.
• 21 say it is giving government too big of a
  role.

48
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package
49
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package Impact on the Economy

• One-third think that the stimulus package has
  helped the economy, while 46 say it has hurt the
  economy. 22 say that it has had no impact on
  the economy.
• 28 think the stimulus package supports
  entrepreneurial activity, while 53 think it
  hurts it. 15 say it has no effect on
  entrepreneurial activity.

50
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package Impact on the Economy
51
Kauffman Foundation Survey of Entrepreneurs The
Economic Stimulus Package Entrepreneurial
Activity
52
Kauffman Foundation Survey of Entrepreneurs
Second Economic Stimulus

• Three-quarters of entrepreneurs say we do not
  need a second economic stimulus to boost our
  economy
• 11 say that we do
• 14 are not sure

53
Kauffman Foundation Survey of Entrepreneurs
Facilitating Economic Growth

• Next, we asked respondents if they think that the
  new administration and Congress are doing as much
  as can be done to facilitate economic growth, or
  if is there more they can do.
• 58 say there is more they can do
• 18 say they are doing as much as they can
• 23 are not sure

54
Kauffman Foundation Survey of Entrepreneurs
Facilitating Economic Growth
55
Kauffman Foundation Survey of Entrepreneurs
Saving and Creating Jobs

• 66 think the new administrations economic
  policy initiatives have not been effective in
  saving or creating jobs
• 21 think they have been effective
• 13 are not sure

56
Kauffman Foundation Survey of Entrepreneurs
Economic Policies and the Federal Government

• 56 say that some of the recent economic
  policies, such as the bank bailouts, stimulus
  package and bailout of the auto industry threaten
  the stability of our free market system.
• 57 think that the federal government should
  refrain from spending money to stimulate the
  economy, given the large deficit we are facing
  and the possibility of inflation being created.

57
Kauffman Foundation Survey of Entrepreneurs
Recent Economic Policies
58
Kauffman Foundation Survey of Entrepreneurs
Federal Government and Spending
59
Kauffman Foundation Survey of Entrepreneurs The
Government and Entrepreneurship

• We then asked entrepreneurs to tell us how much
  they think the U.S. government encourages
  entrepreneurship a great deal, some, not much,
  or not at all.
• 43 say not much
• Next, we asked entrepreneurs whether they think
  that the U.S. government should do more to
  encourage entrepreneurship.
• 58 say yes

60
Kauffman Foundation Survey of Entrepreneurs The
Government and Entrepreneurship
61
Kauffman Foundation Survey of Entrepreneurs The
Government and Entrepreneurship
62
Kauffman Foundation Survey of Entrepreneurs
Entrepreneurship in the United States

• We asked entrepreneurs what they think will
  encourage more entrepreneurial activity in the
  United States.
• 38 say that tax cuts generally will encourage
  more entrepreneurial activity in the United
  States
• 31 say incentives for small business

63
Kauffman Foundation Survey of Entrepreneurs
Entrepreneurship in the United States
64
Kauffman Foundation Survey of Entrepreneurs
Starting a Business in the United States

• 93 of entrepreneurs say that it is important to
  make it easier to start a business in the United
  States
• 2 say it is not important

65
Kauffman Foundation Survey of Entrepreneurs
Starting a Business in the United States

• 31 of entrepreneurs say that the laws in America
  make it easier to start a business in the United
  States, while 35 say they make it more difficult
• 34 are not sure

66
Kauffman Foundation Survey of Entrepreneurs Tax
Rates

• 82 of entrepreneurs say that they are concerned
  about tax rates increasing
• 12 are not concerned