If you've been following news on the economy this week, it's more of the same: jobs are scarce, the housing market is depressed, and business spending is slow.
"Economic activity in the United States has continued to expand at a modest pace, although some areas, including housing, construction and the labor market, remain weak," the Federal Reserve said on Wednesday, Oct. 20.
This is a sobering reality check for millions of Americans who continue to hope the economy will soon turn around.
What's to be done?
With Americans becoming increasingly concerned about the economy and the government stepping in with short-term solutions designed to stimulate the economy, the answer is clear: We must support and encourage entrepreneurship and new entrepreneurial initiatives.
Why? Because it's entrepreneurs who will create the new jobs millions of Americans sorely need.
3 Things for Entrepreneurs to Keep in Mind
1. Don't indulge in delusional thinking.
In this changing economy where unemployment is stuck at 9.6 percent, it's a mistake to think that we're going to return to the way things were anytime soon. And who would want to? Things weren’t all that economically great before the recession began.
Let's face it folks, we're not going to see real estate skyrocket any time soon or lost jobs come back overnight. What we are seeing and will continue to see are entrepreneurs stepping to the plate to create new jobs. This is what will save the U.S. economy. Not the government. Not big business. It will be the U.S. small business sector expanding and creating new jobs that will get us out of this recession.
2. Be realistic.
As an entrepreneur myself, I love the concept of dreaming big and going beyond where anyone has gone before. At present, however, if you're thinking about starting up a business, it's more important to focus on getting up and going now than it is to get qualified for the future.
For that reason, the one thing I caution my clients against is starting up a new business that is more than two degrees different from anything else they've done before in their life or career. That's because if you extend beyond two degrees it is likely that you'll end up feeling overwhelmed with all that you'll need to learn and do just to get up-to-speed.
So, stick close to what you know. Capitalize on your existing skills and experience when starting up. This will not only help you get your business up and going very quickly, it will also save your time and money.
3. Expect more and less from your bank.
While the Small Business Jobs and Credit Act – signed into law by President Obama last month – offers a fresh source of financing for small businesses (including a $30 billion lending fund to be distributed by the Treasury Department to qualified small banks that promise to extend new loans to small business), it's still extremely difficult for small businesses to get their hands on that cash.
Now, more than ever, you must make sure that when you go ask lenders for money that your business plan is a "cogent, practical document that lays out where the business has been from a historical perspective and where it's going and why," so says Christine Reilly, President of CIT Small Business Lending Corporation.
The days when a small business owner could walk into their hometown bank and borrow money to tide over their struggling business are long gone. Nowadays, banks are asking you to front them money by asking you put up your personal residence as collateral to secure your loan. Expect this and be prepared with a solid business plan.
While the news on the economy may sound bleak, most economists agree that the economy will turn around. What is needed the most is creation of new jobs. And that's where entrepreneurship and new entrepreneurial initiatives come in. If you are an entrepreneur, your time has come to do your part in creating new jobs. Start by making sure you keep in mind the above three things and get things rolling in the U.S.
Dr. Susan L. Reid is a business coach and consultant for entrepreneurial women starting businesses. She is the award-winning author of “Discovering Your Inner Samurai: The Entrepreneurial Woman’s Journey to Business Success,” and has a free chapter PDF of her most popular chapter: “Doing What You Love: Multiple Streams of Passion” for those who want see how persistence, patience and practice can really pay off.