The percentage of job seekers starting their own businesses jumped to its highest level since 2007, according to the quarterly Challenger Job Market Index.
About 8.7 percent of job seekers gaining employment in the second quarter of this year did so by starting their own enterprises. That’s up from 6.4 percent in the previous quarter, and it was nearly double the start-up rate of 4.3 percent in the second quarter of 2008.
The second-quarter figure was the highest since the third quarter of 2007, when 10.1 percent of job seekers started businesses. As recently as the final quarter of 2008, the start-up rate fell to a record low of 2.7 percent.
The index is based on a quarterly survey of about 3,000 job seekers in a wide variety of industries nationwide.
Indeed, confidence among existing business owners appears to be on the rise. In a monthly survey of small business owners by the National Federation of Independent Business, the Optimism Index reached 88 in June, up from 84 in January. While the Index is still well below the baseline of 100, it is heading in the right direction after falling to a recent low of 81.
The level of self-employment, as tracked by the Bureau of Labor Statistics, reached a record high of 9.99 million in June 2007, just a few months before the recession began in December 2008.
Even as the percentage of job seekers turning entrepreneurs edges toward 10 percent, it is unlikely that the start-up rate among the unemployed will reach levels achieved in the late 1980s and early 1990s. Between the inaugural year of the Challenger Index in 1986 and 1992, the start-up rate averaged 16 percent annually, peaking in 1989 when 20 percent of job seekers became entrepreneurs.