How America can create jobs
The nation's entrepreneurial prowess may be the best hope to stem 9.7 percent unemployment. Companies from a laser-tech firm to a baby-sitting network are harnessing new ideas – and helping reinvent the economy.
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True, innovation can lead to fewer jobs. If people are changing their oil less often, gas stations and Jiffy Lubes might have less business. Many new products marketed to US consumers are also as likely to create jobs overseas as in the US.
Still, the fact is, innovation usually leads to greater employment, not less. Someone, after all, has to staff the new oil filter business. Plus, as productivity and personal income rise as a result of innovation, consumers have more money to spend on other goods and services.
Innovation can create whole new industries, or enhance job opportunities within an industry. A quotidian example may be baby-sitting. Genevieve Thiers came up with the idea to found SitterCity, an online network to connect parents with sitters, as a college student. The year was 2001. Launching right after the dot-com bust (and as a music/English double major no less), she says she was "laughed out of the room" when she first sought start-up funds from investors.
After a bootstrap start, SitterCity has become a nationwide success. The firm currently employs 30 full-time people, with more on the way. But its bigger impact on the job market may be in home offices and high school lounges across the country. SitterCity's website now lists more than a million available caregivers, 45 percent of whom say they're now considering it as a career.
Ms. Thiers's service is essentially allowing people to create their own jobs: Her site now offers a gamut of home services, from elder and pet care to tutoring and baby-sitting.
Innovation can come in ways that benefit workers as much as consumers. Along the frothy Yellowstone River in Livingston, Mont., a business called PrintingForLess.com could also deserve the name "working for more." Providing an attractive office environment is integral to Andrew Field's recipe for print-shop success.
The company is known locally for its semicasual dress code, in-house day care, and dog-friendly policy inspired by Mr. Field's own border collie. These perks are matched by higher-than-average salaries, plus healthcare benefits. A person who works three 12-hour shifts a week can earn between $50,000 and $60,000 a year.
Field says this investment in keeping employees happy pays huge dividends by creating less turnover. That, coupled with his vision for reaching customers far beyond the northern Rockies with his online commercial printing operation, has spawned a robust business. The 14-year-old company has gone from 11 employees a decade ago to 130 today.
"We put a premium on high performance," says the denim-clad Field. "We tell our applicants that they shouldn't mistake the appearance of people walking around in boat shorts, flip-flops, and dogs lying at their side with a casualness in execution. You need to be smart and motivated to work here."
So if start-ups are still starting and inventive minds are still inventing, what's the problem? In a word: money. Economists and businesspeople say it's one of the worst climates for entrepreneurs in decades. The slowdown in consumer spending is coupled with a credit crunch.