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Out of Work? Some Strike Out on Their Own As Entrepreneurs
Saturday, March 28, 2009 1:05 PM


(Source: The Bakersfield Californian)trackingBy Courtenay Edelhart, The Bakersfield Californian

Mar. 28--After more than a decade with a homebuilder, Russ Johnson found himself out of work.

It was 2007. The real estate market had gone belly up, and his employer didn't need a vice president of land acquisition anymore.

So Johnson decided to change careers. Earlier this month, he opened Firehouse, a new firefighter themed restaurant in southwest Bakersfield.

"In a way I was in better shape than a lot of my co-workers, because I already had experience with family-owned businesses," he said.

Johnson's family owns sports bar The Corner Pocket and pool table retailer Billiards and Barstools.

He follows in the footsteps of some venerable names in business. Tom Stemberg founded office supply retailer Staples after he lost a job with a supermarket chain. Billionaire New York City Mayor Michael Bloomberg launched Bloomberg News after he was fired from Salomon Bros.

In almost every economic downturn, entrepreneurship has spiked.

If nobody will hire you, there's strong incentive to create your own job. Plus, the risk of failure is greatly diminished. It's one thing to leave a secure job with benefits to strike out on your own, but if you're sitting around watching daytime TV, what do you have to lose?

It's too early to know if historic patterns for entrepreneurship are holding up in the current recession, but there's preliminary evidence pointing that way.

The city of Bakersfield saw new business licenses rise 53 percent from 18,306 to 28,020 between fiscal years 2005-06 and 2007-08, the last year for which data are available.

Kern County had an unemployment rate of 14.7 percent in February, compared with 10.9 percent statewide and 8.1 percent nationally, according to the California Employment Development Department.

Oildale resident Edward Rupe, 43, is among those out of work after losing a job as a sandblaster and painter.

He hated it, anyway.

"You breathe sand and paint all day," Rupe said. "It's terrible for your health."

Rupe couldn't find another job. But he had saved a lot when he worked, and used the money to buy a tow truck.

Now Rupe is just a $200 motor carrier permit away from launching his new company, Another Tow Truck.

Rupe isn't sure how he'll come up with that last $200, though. He spent all he had on the truck, and banks aren't too generous with credit these days, especially for someone out of work.

The credit crunch is the wild card that could stymie small business growth, which many believe will lead the nation out of the recession.




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