KANSAS CITY, MO — Reversing a downward cycle that began in 2010, U.S. startup activity climbed last year, according to the 2015 Kauffman Foundation Index: Startup Activity.

The Startup Activity Index rose or fell in tandem with the business cycle over the past two decades, up during the 1990s expansion and plummeting during the Great Recession, the Foundation notes. While he entrepreneurial activity increase in the 2015 Index represents the largest year-over-year increase in the last two decades, it is still “tepid and well below historical trends,” the Foundation says in a news release.

In the 2015 Index, 310 out of 100,000 adults, or 0.31 percent, started new businesses each month, on average. In the 2014 Index, the average was 0.28 percent of the adult population.

“This rebound in entrepreneurial activity lines up with the strength we’ve seen in other economic indicators, and should generate hope for further economic expansion,” said Dane Stangler, vice president of Research and Policy at the Kauffman Foundation in a statement.

Rate increases for all age groups

“But, it’s important to view this short-term uptick in context of the bigger picture – we are still in a long-term decline of activity, which affects job creation, innovation and economic growth.”

The majority of new entrepreneurs – 63.2 percent – were men. The 36.8 percent of females who became entrepreneurs in the 2015 Index is close to the two-decade low of 36.3 percent in the 2008 Kauffman Index.

The rate of new entrepreneurs grew for all age groups except those aged 45 to 54, which experienced no change in the 2015 Index.

A growing immigrant population and the high likelihood of immigrants becoming entrepreneurs contributed to a rising share of new immigrant entrepreneurs: 28.5 percent of all new entrepreneurs are immigrants in the 2015 Index, compared to 13.3 percent in the 1997 Index.

The Latino share of all new entrepreneurs rose from 10.0 percent in 1996 to 22.1 percent in 2014. The Asian share also rose substantially during this period. The share of white entrepreneurs declined over the past 18 years, and the black share increased slightly.

Startup density increasing but still below historic norms

Opportunity entrepreneurs, those who were not unemployed and not looking for a job before they started their new ventures, was 79.6 percent of the total number of new entrepreneurs. This number represented an increase over the 2014

“Entrepreneurs starting new businesses because they saw market opportunities is back to historical norms,” said Arnobio Morelix, research analyst at the Kauffman Foundation, and one of the study’s authors. “When broad-based entrepreneurial opportunity improves at this pace, it’s an indication that the labor market is slowly recovering.”

Startup density increased from 128.8 for every 100,000 people to 130.6 from 2014 to 2015, but remains lower than historic norms.

“Leaders from across the United States have rallied to foster entrepreneurship. Still, the challenge of consistently measuring and benchmarking startup activity has been largely unanswered,” said Rob Fairlie, professor and chair of economics at the University of California, Santa Cruz, and one of the study’s authors.

For the full story see: http://www.kauffman.org/newsroom/2015/05/nations-startup-activity-reverses-five-year-downward-trend-annual-kauffman-index-reports