A report written by Charles Hugh-Smith, an independent economist who runs the OfTwoMinds blog,contained some startling revelations about the true state of the U.S. economy. According to Hugh-Smith's research, countless small and independently owned business throughout the nation have collapsed due to economic pressures since the onset of the Great Recession. Even worse is the possibility that the country may never gain back these positions, which may result in long-term structural employment issues.
The blogger turned to data from the U.S. Bureau of Labor Statistics, which indicated that there was a 1.6 million drop in the number of self-owned companies between 2007 and 2012. Hugh-Smith pointed out that this demographic had been trending upward during the 1980s, but that weaknesses began to show in the early 2000s as the U.S. manufacturing base shifted overseas.
When looking at non-farm employment stats, the situation appears increasingly worse: Self-employed Americans have fallen significantly since the Reagan era, a shift that may be attributed to the corporatization of the U.S. economy.
Hugh-Smith goes on to suggest that the implications of this employment evolution are primarily negative in the context of future economic growth. He argues that small companies provide invaluable education for tomorrow's business leaders, but corporations, which rely on hiring previously experienced personnel, aren't providing these resources.
"Corporations may point to their intern program as 'job training,' but this is all too often a PR facade for unpaid slave labor. How many interns learned anything remotely useful? How many end up with full-time jobs at the company? The typical answer is: very few," Hugh-Smith wrote. "Small business is the incubator of employment. As it declines, so too do opportunities for first jobs, second chances and economic independence."
This trend suggests that the U.S. economy is still facing severe challenges, which makes it imperative for investors to pursue methods of wealth preservation to protect themselves financially. Download our "Free Game Plan Report" today to learn more.