Business Formation: A Tale of Two Recessions
January 2021
Working Paper Number:
CES-21-01
Abstract
The trajectory of new business applications and transitions to employer businesses differ markedly during the Great Recession and COVID-19 Recession. Both applications and transitions to employer startups decreased slowly but persistently in the post-Lehman crisis period of the Great Recession. In contrast, during the COVID-19 Recession new applications initially declined but have since sharply rebounded, resulting in a surge in applications during 2020. Projected transitions to employer businesses also rise but this is dampened by a change in the composition of applications in 2020 towards applications that are more likely to be nonemployers.
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report,
payroll,
quarterly,
disclosure,
employed,
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recession,
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Employer Identification Number,
Longitudinal Business Database,
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Business Dynamics Statistics,
Linear Probability Model,
Business Formation Statistics,
COVID-19
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