Plenty of employees have visions of launching their own ventures. Layoffs are spurring some of them to make the plunge
Sara Clemence (center) launched Recessionwire with Laura Rich (right) and Lynn Parramore a few months after getting laid off.
They're casualties of the recession: the millions of workers laid off
as employers slash payrolls. With few companies hiring, a number—no
data exists on what percentage—of the newly downsized have decided to start their own ventures instead of looking for work in an economy shedding hundreds of
thousands of jobs each month. Visit http://images.businessweek.com/ss/09/03/0313_rebounders/1.htm to view the slide show of the "rebounders" that are turning their ideas into ventures.
The unemployment rate, at 8.1%, is higher than at any point in the last 25 years. Nonfarm
employers cut 651,000 jobs in February alone, and 2.6 million vanished
in the last four months. Many are disappearing from companies that were
titans in their industries, such as GM, Yahoo!, or the now-defunct Washington Mutual bank, absorbed by JPMorgan
in the financial collapse. Some workers cast off by these companies say
even the risky venture of starting their own companies offers more
stability than going back to work for someone else.
Tom Hodge, a 34-year-old journeyman toolmaker who spent 12 years at
the GM assembly plant in Moraine, Ohio, decided to take a buyout when
the plant closed two days before Christmas rather than put his name in
the hat for a transfer. Watching GM chief Rick Wagoner plead for a
bailout from Congress helped him make up his mind. "I don't trust the
fact that they have any jobs for me at all. I feel like now I'm in a
position to rely on myself," he says. He's starting his own machining
business, Absolute CNC Machining, from a 1,500-square foot workshop in
Germantown, financed in part by his buyout from GM.
Some in this new crop of entrepreneurs see market opportunities in
the same trends that cost them their old jobs. Brent Schludecker, a
38-year-old chemist who tested Pfizer
drugs for compliance at the pharmaceutical giant's Terre Haute, Ind.,
plant, was let go a year ago when Pfizer announced the plant would
close. Now, he and other colleagues have opened a lab to "do the same
thing we were doing at Pfizer and offer it to the industry, " he says.
Schludecker, who bought lab equipment from the closing Pfizer plant,
intends to target food and pharma companies looking to cut costs by outsourcing their compliance testing.
Even in so-called recession-proof sectors such as health care, which
actually added jobs in February, layoffs are spurring workers to start
their own businesses. Maureen Molinari, a 44-year-old dietician and
diabetes consultant at St. John's Medical Center in Jackson, Wyo., was
devastated when she ways laid off in November. "I think I have a secure
job, and all of a sudden, bam! It's gone," she says. Molinari, who long
dreamed of making her own hours, now works as a nutrition consultant
for individual patients and a rural hospital in Idaho.
Many of the newly laid off seek help from organizations such as SCORE or local small business development centers to get their ventures off
the ground. Martin Lehman, a SCORE counselor in Manhattan, says he has
noticed a substantial increase in people who have been laid off,
particularly from Wall Street firms, coming for business advice. While
a layoff is rarely welcome, he says, it can liberate some people to
pursue long simmering business ideas. "Maybe they can make a living at
it. It may be something that they really wanted to do anyway, and this
is sort of a blessing in disguise," Lehman says.
That was the case for Patti Tower, laid off from her job as a director in IT infrastructure at UBS
in Stanford, Conn., after 11 years with the bank. Tower, 46, says she
has no regrets about her time with UBS, but now she has the chance to
pursue an idea for a nascent fashion business full-time. "I've been
doing this for years and years and years," she says of her hand-painted
T-shirts and embellished vintage items. "I just couldn't imagine that I
could make a business out of it."
To read more, visit http://www.businessweek.com/smallbiz/content/mar2009/sb20090312_782469.htm?chan=smallbiz_smallbiz+index+page_getting+started