One of the most misunderstood topics about entrepreneurship is job creation. The prevailing wisdom is that new businesses create jobs primarily because newly formed companies tend to grow over time.
This misperception comes from how people typically look at the data on new businesses. In general, observers look at the number of people employed at the average new firm and compare that to the number of people employed at the average firm that is, say, six years old.
How Start-Ups Really Create Jobs — and What This Means for Employment Growth