And this is not good news: The number of individuals starting new businesses in the US fell by 24% in 2008 -- that's twice Spain's collapse and four times worse than the UK.
When I saw this graph about the toll the recession has taken on entrepreneurs, the first thing I thought of was green energy.
Maybe that's because a close friend of mine is starting a green energy company. But it's also because a lot of economic analysts expect energy to be a major source of growth and job creation in the next ten years. The problem is (as my friend can attest), just as world governments' interest in green technology is increasing, investment in green technology is falling off a cliff. As the Economist explains here, renewable energy has a high upfront cost, even if you save a lot of money with efficiency over time. That makes firms reluctant to become customers, which makes venture capitalists reluctant to become investors:
Companies cannot be expected to abandon them unless they get a clear signal from consumers or governments that it is in their financial interest to do so. And they are not getting such a signal.
The answer is elusive. A carbon price in England, for example, has not spurred a renewable energy revolution, the Economist reports. Still the United States should be creative. Programs like "Cash for Caulkers" that pay homeowners to retrofit their homes are a nice start. Or we could invest in green technology more directly, as Evan Osnos chronicled in this New Yorker story about China's "crash course" in green technology. Or the government could poor money into energy storage research, and heed the predictions of Montana Gov. Brian Schweitzer about battery technology being the key to the global technology revolution. The point is: There is a lot more that we can do, and a green tech policy could go a long way toward recovering America's entrepreneurial spirit and creating a new fleet of jobs that last.
[Via Real Time Economics]