More Americans are choosing to be their own boss, with Utah ranking fourth nationally in the percentage increase in sole proprietorships, according to a new report by the U.S. Census Bureau.
In Utah, the number of self-employed businesses in 2004 rose to 163,426, a 6.1 percent increase from 154,097 the prior year, according to a census report released Thursday.
They include people like Alex Nabaum, of Heber City, a freelance illustrator who started working for himself in January 2005. Nabaum, who converted part of his home garage to an office, routinely does work for The New York Times, Time magazine and the Wall Street Journal.
"I get paid a lot more," Nabaum said. "You get rewarded according to your willingness to take risks and your talents. But there are downsides. There is no paid vacation and no (medical) benefits."
Still, those downsides appear to be acceptable for the thousands of people choosing to be self-employed.
Nationally, the number of businesses having no paid employees rose to 19.5 million, a nearly 1 million increase, 4.7 percent increase, between 2003 and 2004. The report noted that nonemployer firms can be run by one or more individuals, can range from home-based businesses to corner stores and are often part-time ventures with owners operating more than one business. It also can include people who operate their own business in addition to working for someone else.
In Utah, most businesses with no paid employees were found in the real estate and rental and leasing sectors, which accounted for 15 percent of the state's total sole proprietorships and included real estate appraisers, agents and brokers.
Derek Miller, director of the Utah Division of Real Estate, said those numbers are not surprising in light of Utah's hot real estate market and the tax advantages associated with being an independent contractor.
In fact, Miller said in Utah there are roughly 400 new real estate agents licensed each month.
Coming in second place was the professional, scientific and technical services sector, which includes attorneys, accountants and landscape architects. That sector had 23,739 nonemployer firms.
Utah's construction sector made up 11 percent of Utah's total nonemployer firms.
Businesses without a payroll make up more than 70 percent of the nation's more than 27 million firms. Florida ranked No. 1 in the nation in the growth rate, at 7.6 percent. West Virginia came in last, with a growth rate of 1.6 percent.
Kathy Ricci, executive director Utah Microenterprise Loan Fund, said her organization has made more than 430 micro-loans to Utahns over the past 11 years.
"Entrepreneurship is so strong here in Utah," Ricci said. "Everyone who comes here is potentially looking for a loan for their small business. For our clients it's often a supplement to another job. Self-employment and microenterprise is attractive because it enables them to find a way to supplement their income and build wealth and build assets."
E-mail: danderton@desnews.com