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Biden says Americans are launching small businesses at ‘record rate’

Claim: Joe Biden says his presidency has seen a record creation of small businesses.

“I’m proud to say that if you look at my presidency so far, it’s a presidency for jobs and a presidency for small businesses,” Biden said on Monday. “This is what the file shows. Save job creation. Record economic growth. Save the creation of new small businesses. It is history that should give us confidence in the economy we are building. Self-confidence. Confidence in the future.

“Our economy is creating new businesses – a lot of new businesses. In fact, Americans are launching small businesses at an all-time high – up 30% from before the pandemic, ”Biden added.

Verdict: Lack of context.

The highest monthly number of business start-ups was recorded in July 2020, under President Donald Trump, when Census Bureau data shows 552,748,000 business start-ups were filed.

That number was high because so few businesses were started in March and April, when much of the economy was stalled and entrepreneurs put projects on hold. Many other businesses have closed due to the pandemic and lockdowns. The combination of pent-up demand for business start-ups and the upturn in economic activity has led to historically high levels of business start-ups in the second half of 2020.

If we look at business start-ups from July through October, the total and the monthly average were higher under Trump. Total trainings for the period stood at 1.89 million in 2020 and 1.74 million under Biden. The monthly average for the period was 472,543 under Trump and 435,242 under Biden.

Of course, the year-to-date totals favor Biden, as depressed numbers in the first few months of the pandemic caused start-ups to slow down. So this year has seen record start-ups, it is mainly for the same reason that Trump has seen record-breaking startups in the second half of 2020: pent-up demand, restarts, and an economy that accelerates as the drag of the pandemic is fading.

Put in the right context, recent small business growth is primarily a reflection of an economy recovering from the pandemic rather than the result of the policies of either president.

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