American companies are getting older. According to recently published US data, in 2016 nearly 20% of American business companies were less than 10 years old. This is a dramatic change from two decades ago, when almost 40% of companies are under the age of 10.
Although the average age of US companies has been rising for decades, the pace of this change has accelerated considerably since the Great Recession.
The reason is the serious lack of startups.
Unlike many other factors related to the US economy, such as unemployment and household income, the creation of a new business can not yet return to 2008 levels.
The economist Lucas Puente looks at the trends of small businesses, believing that recent trends in this area are a cause for concern.
“In 2016 there is a serious decline in the number of startups. Then, 125,000 new companies were registered, which is 15% less than in 2006”, commented the economist.
Since the 1980s, the share of all sales, targeting large companies, has increased in most industries and businesses.
The startups are hardly able to compete with business leaders, who can pay more for staff and increase the chances of new companies being “kicked off” from the sector.
Studies show that the number of startups is small in those states where the market is dominated by a small number of big companies.