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False Alarm

The truth behind a reported drop in start-ups.

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This story appears in the April 1999 issue of Entrepreneur. Subscribe »

If you've read the news reports regarding a recent survey ofbusiness start-ups, you might think the small- sky isfalling. That's because according to a study by the NationalFederation of Independent Business (), the number of businessesstarted in 1997 fell 4 percent, following a 14 percent drop in1996. "But this is a marginal change," says William J.Dennis, a senior research fellow at NFIB. "There are still alot of people out there starting businesses and looking forhelp."

Bruce D. Phillips, director of economic research at the SBAOffice of Advocacy, agrees the shouldn't be blownout of proportion. "You need six, seven or even eight[surveys] saying the same thing before there's cause forconcern," he says.

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