Micro Multi-nationals are tearing corporations and government social security systems apart

Corporations are not job creators; they are job cutters.

You might says that’s a new phenomenon. But it is it? Haven’t corporations always cut jobs once profits are down?

However, most people will dispute a statement like “corporations create few new jobs”. But it’s true.

Between 1980 and 2005, all net job growth in the United States came from firms that were less than five years old.

Think about that.

Between 1997 and 2008, many people created their own workplace by creating their own start up. It’s becoming the norm. Corporations are also becoming part of the freelancer economy — cutting employees and hiring short-term contractors.

Smaller more agile companies are the future: The Micro-Multinational

To work, our economy depends on smaller, agile companies. Globalisation has made that much easier, with a lot of small companies now having a global reach, for example Natterbox, which provide global telephony solutions that integrate with SalesForce.

This is the era of the Micro-multinational. These companies are typically still referred to as small- and medium-sized enterprises (SME), but because of the online world and the tools, talent and reach available there, these companies are becoming more impactful.

Another important thing to consider is that up until recently only large companies could build a global reach. That is absolutely not the case anymore. We are slowly but surely moving to a situation where everyone is competing with everyone else, so to speak.

Moreover, these small and agile companies can enter markets with little bureaucracy and few overheads, and they are resilient to adapt to changing market conditions; the opposite of a lot of corporations.

This raises a very important question about the way our politicians think.

Big business gets the glory

Why are politicians incentivising big businesses to create jobs, when the real job creators are small companies and self-employed entrepreneurs?

Just like large corporations, the average politician is slow to respond and adapt. The political elite of the 21st century should now get to grips with the fact that jobs are being created by globally focused SMEs (a.k.a Micro-multinationals). With access to a keyboard, positive spirit, confidence and not least some skills, it is very possible to create your own job today.

Just remember that you are taking all the risk.

Most modern countries are still favouring the safe and stable paradigm of supporting the “cherished large national champions” ahead of other types of companies that may be perceived as too small or foreign. This means young companies and entrepreneurs will create the majority of new jobs, while the big companies will take a large part of the credit for economic upturns, and receive financial support from governments.

It’s all on you

In most countries, employees have much higher standards of social security than self-employed individuals. So if your venture does fail, or you hit a rough patch, you will have to take care of yourself. However, if your corporate job disappears, most governments will have a decent benefits system for you.

This shows the need for modern globalised thinking to enter the minds of everyone, not least policy makers and big companies. Truth be told, a lot of us are worried about the idea of safe domestic corporations losing their power and people taking employment into their own hands through the ever growing pool of talent for hire, a.k.a “freelancers”. It is, almost literally, a foreign concept.

In recent years the public has started to take more responsibility for their pensions. With the new economy, a lot of people are also taking more, if not all, responsibility for their employment. One can only assume that soon the general population will have to take much more responsibility for their social security, which is hitherto provided by employers and states.

And that is why Micro-multinationals are tearing corporations and government social security systems apart.

A new “Industrial Revolution”?

With global capabilities suddenly within the grasp of everyone with a business idea, the world can expect another “industrial revolution”. Although it is fair to say that this change is also driven by technologies like 3D printing and A.I.

Nonetheless, companies that are able to catch onto this trend and adapt their products and services accordingly, will certainly be ahead of the pack in the coming years.

Sources:

http://www.lisboncouncil.net/news-a-events/383-the-rise-of-the-micro-multinational.html

http://natterbox.com/micro-multinationals-white-paper/