Vaccines are rolling out at a pace of over 2mm doses per day and some big banks are predicting the US reaching herd immunity by the summer. Speculation of what the future holds is plentiful. Is WFH permanent? Will leisure travel boom? When can I just sit at a bar and chat up the bartender while I munch on my burger and fries?! If you missed our webinar last week, one of the main topics covered was the potential for a shift in market leadership from large-cap technology companies to smaller, more economically cyclical areas of the market.
Whether or not that comes to fruition will be seen over the coming months and years. One thing is clear, the “Entrepreneurial Spirit” in America is alive and well. According to data from the US Census Bureau, the pace of new business applications noticeably accelerated after the first few weeks of the lockdown. Applications did not just see an initial bump but are continuing at an above-trend pace since 2006 when the data tracking began. If there’s any indication that small companies could lead the way out of this deep recession, this is a pretty glaring one.
The COVID-19 pandemic has been terrible on so many fronts, but it is encouraging to see that the “American Dream” is still going strong. Maybe we will emerge stronger and better as a country!
So, what might be the cause of this?
Well first, t could be the amount of time on people’s hands. Ask yourself, what have you done with the extra hour or two that you’re not spending commuting to work? Clearly many people have tried to pick up a “side hustle” to earn a different or additional income stream. Technological improvements allow for digital “storefronts” today that weren’t available even ten years ago. Etsy just announced earnings that were well above expectations, showing the strength in small business producers. COVID created a perfect storm to invest in yourself and your idea. With interest rates low and cheap money around, savvy folks are finding funding to get their ideas off the ground. In today’s world, almost everyone can start a business out of their garage and try to become the next Steve Jobs or Jeff Bezos!
This is an unbelievably encouraging statistic and trend that we look forward to watching unfold over the coming months and years.