- We Need an Abundance Agenda
- Feeding 8 Billion People Has Never Been Easier
- The Greatness of Growth
- Testing Freedom
- A Successful Abundance Agenda Must Address Americans’ Anxieties
- Time to End the Manufactured Shortages in K-12 Education
- The Abundance Agenda: A Radical Response to Populist Protectionism
- Why We Need To Achieve Housing Abundance
- Getting to Housing Abundance in the Shadow of History
- Making Transportation Faster, Cheaper and Safer
- General-Purpose Technologies Are Key To Unleashing Economic Growth
- Zoning Out American Families
- Abundance Is About More Than Stuff
- Prometheus Unbound
- High Anxiety, Low Abundance
- An Abundance Agenda Promotes Social Mobility
- The Role of Sound Monetary Policy in an Abundance Agenda
- The Abundance Agenda: Energy, the Master Resource
- Rhetoric Creates Opportunities for Abundance
- Making the Case for Abundance
- Abundant Work Opportunities Can Revitalize the American Dream
- The Path to Abundant Air Travel
- America Needs More Privately Funded Infrastructure
- How Can You Advocate for Abundance with Skeptics?
- Building a Financial System That Enables Abundance
- Where Did Our Belief in Abundance Come From?
- Removing Government Barriers to Fertility
- On a Certain Blindness in Healthcare Policy
- AI and Telehealth Are Paving the Way for a Future of Abundant Healthcare
My family and I moved to the United States from Armenia in the mid-1990s. After years of living through war, a devastated economy and food shortages, we found that America stood true to its symbol as the land of abundance and opportunity. My parents found work as soon as they arrived, and in addition to an abundance of food, housing and supplies to get our new life off the ground, we found an abundance of kindness, generosity and charitable giving from our community members.
The lesson I learned then was one that I continue to hold dear: Abundance is what made my American Dream come true—and it can for millions of other working families today.
More than Stuff
Several Discourse contributors have discussed pro-abundance policies in areas such as housing, energy, transportation and general-purpose technologies. These are policies that focus on building and jump-starting growth to improve living standards.
But at the heart of an abundance agenda is more than just “stuff”—as my colleagues David Masci and Eileen Norcross write:
Abundance also is human creativity in action, the pursuit of goals that will make the world a better place…. Economic growth also leads to more and better job opportunities, at all levels of society. This helps Americans of all stripes, but it is particularly important for those from poorer backgrounds. As former President Obama has said, ‘The best anti-poverty program is a job.’
A society that prioritizes human flourishing will generate new and better opportunities for individuals to reach their potential, to use their talents and to pursue their own American Dream—whatever that may be. The United States got its reputation as the land of abundance and opportunity because it had one of the world’s most entrepreneurial, dynamic and flexible economies, which created a plethora of work opportunities for millions of people. For example, the United States has both the highest startup birth and failure rates across the globe and produces the greatest share of the world’s “unicorn” enterprises—private companies that are highly valued and successful, such as Facebook, Amazon and Google.
At a time of slow economic growth with fading hopes of an optimistic future, the fundamental question is how can we create an environment that provides an abundance of work opportunities?
A key component of a booming economy depends on the larger macroeconomic environment. As my colleague Patrick Horan has described, sound monetary policy is key to creating a pro-abundance macroeconomic policy. But beyond sound macroeconomic policies, there are three areas that we can prioritize to bring about an abundance of work opportunities:
- Promote a vibrant entrepreneurial environment
- Welcome new and diverse forms of income-generating opportunities
- Reduce labor regulations that thwart mobility and dynamism
Promoting a Vibrant Entrepreneurial Environment
Where do jobs come from? They come from all kinds of companies—from new and young startups, small businesses, medium-size enterprises, and large and established organizations operating in a healthy and dynamic economic environment. These diverse organizations play complementary roles in generating economic value and job opportunities. Startups account for about 20% of total job creation. High-growth businesses (which are disproportionately young and new) account for almost 50% of gross job creation in the United States—an important reminder that fostering entrepreneurship has benefits not just for entrepreneurs, but for innumerable workers as well.
To create jobs in a dynamic market, some businesses will close and contract while others open and expand. Economists have long discussed the benefits of this type of business dynamism, which includes new company entrants, exits, expansions and contractions—all as part of a healthy economic environment. Many new businesses close within their first 10 years, while other small businesses remain small and employ just a handful of workers for most of their existence. At the same time, there are small businesses that turn into high-growth companies and contribute substantially to job creation. For example, Google—a three-person firm in 1998—grew into a 20,000-person firm in just 10 years. Today, it provides job opportunities for nearly 200,000 people.
However, the rate of startup entry and the pace of business and employment dynamism in the U.S. has been falling over recent decades. Some patterns suggest that the incentive for entrepreneurs to start new firms has diminished over time. For instance, in the World Bank’s Doing Business Index, the United States’ ranking for “starting a business” has plummeted because the costs of starting a business, registering property and business taxes have substantially increased over the last few decades. The same is true in the Economic Freedom of the World Index, which shows that bureaucratic costs and regulatory hurdles have steadily worsened for businesses. In the Mercatus Center’s RegData, the burden of federal regulations grew by almost 170% between 1970 and 2019.
Recently, I had the opportunity to interview several startup founders, and it was clear to me how overregulation has hurt their ability to succeed and create opportunities for workers. Some entrepreneurs working in software felt that regulations were light, and as such, they were able to expand, hire workers and grow their companies in a short period of time. However, many more entrepreneurs, especially in energy, medicine and healthcare, and transportation, extensively discussed how regulations had hindered their ability to get their companies off the ground. For some, it resulted in closing their businesses, and for others, it meant devoting more time, resources and money to overcoming bureaucratic hurdles instead of toward hiring workers and growing the business.
But the evidence isn’t just anecdotal: Countless studies have documented that too much red tape for businesses impedes economic activity, startup entry, entrepreneurship and job creation. This is especially true for early-stage entrepreneurs who are often resource- and cash-constrained. Indeed, one recent analysis of U.S. regulations across industries finds that greater industry regulations are associated with lower firm startup rates and fewer new hires, especially among smaller businesses.
Generating an abundance of work opportunities begins with creating a welcoming environment for existing businesses and for new entrepreneurs to build, scale and hire workers. For that process to unfold, we need to ease the regulatory shackles and revive our once vibrant and dynamic entrepreneurial environment.
Welcoming New and Diverse Forms of Income-Generating Activities
Work opportunities come in many different shapes and sizes. In today’s economy, traditional 9-5 employment is but one option: Freelancing, contracting, consulting, selling goods and renting property provide additional sources of income opportunities.
What these varied opportunities prove is that we should shatter the outdated notion that a job can only be provided by a company or an organization. Each one of us provides a job for someone else when we hire a music teacher or a tutor, when we order customized T-shirts on Etsy, when we request a ride from the airport, or when we have an electrician inspect our homes. While these types of jobs existed also in the 20th century, the internet, search engines and peer-to-peer platforms have vastly expanded the opportunities for millions of Americans to make income through sources outside of traditional employment.
Today, there are more than 60 million workers earning income—either as a primary or secondary source—through nontraditional means. And over the last three decades, there has been significant growth in independent and flexible work opportunities, growing faster than employment itself.
In this way, we have truly seen an abundance of work opportunities flourish across our nation as the set of “job providers” has expanded beyond companies and to ordinary individuals. However, many policymakers are attempting to reduce these new forms of work. For example, when California passed a contentious law in 2019 limiting independent work, it resulted in significant job losses across the state, especially among writers, musicians, translators, editors, photographers and other typical freelance jobs.
Several states, as well as the federal government, are also contemplating similar policies under the justification that only traditional employment opportunities provide “good jobs.” These policies are anti-abundance agenda driven in that they seek to reduce the number of work opportunities and restrict the diversity of work to only a traditional employment arrangement. Instead, pursuing an abundance of work opportunities means that policymakers should welcome new and diverse forms of income-generating activities.
Reducing Labor Regulations That Thwart Mobility and Dynamism
While Italy surely has an abundance of beautiful landscapes, food and art, what it doesn’t have is an abundance of work opportunities. At a staggering 30%, Italy’s youth unemployment rate is one of the highest in the developed world. It is no coincidence that Italy also has one of the most highly regulated labor markets among its Western counterparts—one that makes it almost impossible for businesses to fire employees. As a result, employers are hesitant to hire workers, especially inexperienced youth—forcing many of them to seek employment abroad.
Indeed, a set of studies found that when Italy even slightly reduced labor market regulations, it led to increased employment dynamism and more jobs for younger workers. But Italy is not a stand-alone case. Through case studies around the world, economists have long documented how more-restrictive labor regulations lead to less labor mobility, fewer job opportunities and higher unemployment rates.
This also illustrates the trade-offs policymakers must face when pursuing labor regulations. Yes, employment protection regulations can help with job security and job stability for existing workers who are already in those positions, but it comes at the expense of harming labor market dynamism and reducing job creation. Unfortunately, inexperienced, older and low-skilled workers are often harmed the most by these employment protection regulations. To create abundance of work opportunities, we should seek to reduce regulations that limit the mobility and dynamism in labor markets.
The Way Forward
My family is living proof that an abundance agenda works. Coming to this country truly changed our lives: The abundance of opportunities and support we received made the successful pursuit of our American Dream possible.
For those of us advocating for a transformative abundance agenda and “supply-side progressivism,” providing an abundance of work opportunities is at the heart of this initiative. Policies that encourage a vibrant entrepreneurial environment, welcome new forms of work, and encourage labor market mobility and dynamism will move us toward a more flourishing and thriving economic environment—an environment that makes more American Dreams come to fruition.