The Current State of the Economy
The current state of the U.S. economy is favorable and promising. According to the Bureau of Economic Analysis (2021), “real gross domestic product (GDP) increased at an annual rate of 6.4 percent in the first quarter of 2021” (para. 1). Such an increase can be explained by several factors, including low interest on loans, job growth, and mass vaccination rollout. Since it is cheap to borrow money in the United States, small businesses are growing, comprising “99.7 percent of U.S. employer firms” (Small Business Administration, 2012). The top three sectors with the highest payroll per employee are management of companies and enterprises, information, and utilities (United States Census Bureau, 2021). The industries with the lowest payroll are accommodation and food services, retail trade, and non-classified industries (U.S. Census Bureau, 2021). The governmental promotion of innovation and entrepreneurship and Obama’s elevation of the Office of Science and Technology Policy gave rise to the development of the information and internet technologies industry (Acharya, 2016). Thus, the current state of the economy is quite positive.
At the same time, such an economic rise will not last forever. In the upcoming years, the economic output is estimated to grow by 1.7 percent annually, which “is less than its long-term historical average” (Congressional Budget Office, 2020). Such a decrease may be related to the changes in the labor force and equipment. If American businesses want to improve the situation, they will need to adapt to these changes and invent something new. Moreover, the United States is trying to insource, but 96 percent of the world’s consumers live abroad (Small Business Administration, 2014). Thus, the state will need to expand into global markets to improve the situation of its economy.
Upstate New York Local Conditions for Entrepreneurship
The economy of Upstate New York is continuing to underperform due to slow job growth and high housing prices. Although the state attracts skilled professionals and provides perfect access to capital, high taxes, and housing prices negatively affect businesses. Nevertheless, those people who want to open small enterprises have numerous opportunities in this state. According to the Small Business Administration (2018), there are 2.1 million small businesses in New York. These businesses employed 4.0 million people, or 50.2 percent of New York employees, in 2015 (Small Business Administration, 2018). The unemployment rate was 4.7 percent in 2018, which means that there is a place to grow for local entrepreneurs (Small Business Administration, 2018). At the same time, complex regulations often push entrepreneurs away, making them move to other states, where the laws are more loyal and easier.
New York state regulations are challenging and require additional costs. Thus, business owners have to register their business names and marks (trademarks, service marks, collective marks, and certification marks) and purchase business insurance before starting a new business (Cuomo & Zemsky, 2019, p. 31). Although these regulations are similar to those of other states, the local regulations require many preparations and efforts. Entrepreneurs often have to work with different state agencies to decrease the regulatory burden, thus spending additional costs on their services. In addition, the competitive labor market in the state requires business owners to invest more money in recruitment and offer benefits to the potential employees to keep them in business. High taxes and living costs become additional challenges to the entrepreneurs who want to open a new business in New York State.
The Current State of the Chosen Industry: Sales of Digital Arts
The chosen industry involves sales of various digital art in Upstate, New York. According to McAndrew (2020), New York State accounted for about 90% of U.S. art sales in 2020 (p. 3). 74% of New York collectors buy digital art through online channels, which means that digital sales are not as rare as they seem to be (McAndrew, 2020, p. 34). Online media and platforms allow collectors to buy various pieces of art from all around the world, and they do not even need to meet the owners. The report shows that 47% of collectors purchased art through a gallery website or email, 36% used online auctions, 32% bought art through online viewing rooms (OVR) of a gallery, and 22% purchased through an art fair OVR (McAndrew, 2020, p. 43). These statistics reflect the current state of the digital art sales industry in New York State, demonstrating that this sphere is quite successful.
At the same time, one should better assess the regulations and laws regarding digital art sales in New York. The report by McAndrew (2020) reveals that New York has the most transparent rules and policies for the art market (p. 57). These regulations and laws aim to protect both buyers and sellers and create a business-friendly environment. Since the state is accounted for the biggest part of American art, one can assume that its regulations are fair and favorable for entrepreneurs. With the growth of the online market, entrepreneurs received better opportunities to open their businesses, and it is now the right time to become an entrepreneur.
Self-Reflection and Evaluation
Having examined the current business environment in the chosen industry, I can conclude that I am ready to grow a business in this environment. Online sales of digital art are at their height now, and they will increase in the future. New York State offers numerous possibilities to new entrepreneurs, and the regulations and policies for this industry are transparent and fair. Thus, entrepreneurs can run their businesses online, and they do not even need to fill in printed documents and set appointments to register their business. Everything, beginning with health permits and ending with the company structure, can be done online in New York. Moreover, socioeconomic conditions and government policies are favorable for the current business environment nowadays.
However, some other factors may negatively affect the business environment. For instance, according to Lee (2010), a lack of financial support for business and poor entrepreneurial skills may become a great challenge to those who want to lead a business (p. 9). Fortunately, there are a lot of business training and entrepreneurship courses in New York. Entrepreneurs may also receive financial assistance through various federal programs, grants, and fund and tax credits available in the state. Although small businesses have limited access to federal grants, one can seek help from private investors and huge corporations. Therefore, I will be able to solve the obstacles to the business mentioned above if I make enough effort and find investors.
One more integral part of any business activity is networks. Hickenlooper (2014) defines networks as an essential way for entrepreneurs to communicate and collaborate with other business owners, find investors and staff, promote their business, share information, and learn something new (para. 7). The New York State is a perfect place for such networks because businesspersons from different cultures and with diverse skills work here. The state offers a business-friendly environment, attracts multicultural workforces, and has an outstanding technical infrastructure. Various meetups unite mentors, business founders, high-skilled professionals, and office mates every day, making the state unique and special. To conclude, the time is right to start or grow a business in this environment, even though some challenges may occur during this process.
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Hickenlooper, J. (2014). Cultivating an entrepreneurial environment. Ewing Marion Kauffman Foundation. Web.
Lee, B. (2010). University students’ assessments of entrepreneurial environments. Dissertations, Theses, and Student Research from the College of Business, 10. Web.
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