A new report suggests new business formation has hit historic lows; here?s how four cities are trying to help new owners open doors Whether it?s a single block of stores in an idyllic small town or the business district of a bustling urban square, every vision of Main Street America has something in common: a panoply of small businesses, symbols of American opportunity and success.
But in today?s economy, that vision often looks as realistic as a Rockwell painting. According to Dynamism in Retreat, a new report by the Economic Innovation Group, a bipartisan public policy think tank, small businesses aren?t just suffering?they?re in the midst of a striking, and historic, decline.
?We?re adding businesses at the most anemic rate in history,? says John Lettieri, cofounder and senior director for policy and strategy at EIG. ?We?re five full years into the recovery, and you still see an inability to get anywhere near historic norms for business formation. It?s a structural shift.? Lettieri and his colleagues have tracked national small business and startup formation rates since the 1970s, following the booms and busts of the economic cycle. But the shock of the Great Recession was a ?perfect storm? so profound, Lettieri?s team discovered that it sped up the rate of decline by 20 years.

Economic Innovation Group
A telling graphic showing the shrinking areas of small business formation over the last few decades.

The collapsing market destroyed ...