Title: Entrepreneurship and employment generation: a longitudinal analysis of startup characteristics on net job creation
Authors: Merith Ifeoma Anaba & Emmanuel Yusuf Attah
Volume: 10
Issue: 4
Pages: 10-21
Publication Date: 2026/04/28
Abstract:
This study investigates the relationship between entrepreneurship and employment generation by examining how startup characteristics influence net job creation over a five year period. Using longitudinal data from the Kauffman Firm Survey covering 4,928 new ventures in the United States, we employ fixed effects regression and quantile regression models to test whether initial venture size, industry sector, and founder prior entrepreneurial experience differentially predict employment outcomes. Our findings reveal that entrepreneurship does not uniformly generate employment. Rather, high growth ventures, often called gazelles, account for a disproportionate share of net job creation, with the top ten percent of startups generating nearly sixty percent of all new jobs. Founders with prior entrepreneurial experience are associated with twenty two percent higher employment persistence compared to first time founders. Moreover, technology intensive sectors exhibit lower initial employment but higher job quality and survival. These results challenge the assumption that all forms of entrepreneurship contribute equally to employment and suggest that policy interventions should target scalable ventures and experienced founders. We discuss implications for entrepreneurial ecosystems, labor market policy, and future research on venture growth dynamics.