Elaine Powell has been struggling to make ends meet since her husband lost his construction job a few months ago. A part-time worker at Rockdale Medical Center in Conyers, Powell wasn’t earning enough to support her family, a common problem during the recession.
Her solution was to spend around $15,000 of her own money to open up Lolly Pop Caribbean Restaurant in Covington.
"I wasn’t making very much (at RMC), and I was only getting small 30 cent raises even though I had worked there for three years," Powell said. "(I opened the restaurant) because I can cook. If I can’t do anything else, I know I can do that. And I know that even with the (down) economy, people still have to eat."
Although Powell’s solution is risky, she’s not alone as many people are turning to self-employment to provide a job and at least the potential of more income.
"We are seeing a huge increase in the number of people trying to start up new businesses," said Jeff Mesquita, chairman of the Atlanta chapter of the Service Corps of Retired Executives. "I’m an entrepreneur and all of us at some point have the entrepreneurial spirit. It’s coming to a point now where people are scared because they’re going to lose their job and they don’t see the opportunity to find another job. They’ve always had this idea and they have some money put away and they say I’m going to do that (start a business)."
Though unemployment has rapidly risen in Newton and surrounding counties since the recession began in December 2007, Debby Dial, the Covington Building and Zoning director, said Covington had not seen a business license decrease so far in 2009. The number of new business licenses given out in 2008 compared to 2007 declined rapidly in Henry, Newton and Rockdale counties, but 2009 has seen some improvements. Newton County gave out 550 new business licenses in 2007, 466 in 2008 and has given out 190 so far through the end of April, with 20 more licenses pending approval. Even if the rate of business licenses decline, the county will still likely top 500 licenses for the year.
One of the reasons for stabilization of business licenses is the increased number of unemployed or part-time people who are starting up their own businesses. They’re doing this to provide income, whether full or supplemental, and to give themselves the opportunity to pursue a new career.
Mesquita said he’s been working with a former employee of BellSouth, who in her spare time wrote a children’s book. Now she’s working on publishing and selling the book.
Starting a small business is always risky and even more so in a depressed economy. However, the current economy is ironically the best time for many people who are out of work to start a business for several reasons. Mesquita said that renting store space is much cheaper now than a year ago, and the large number of unemployed people provides an inexpensive, experienced work force. He also said that banks are beginning to loan and that the Small Business Administration is lending on much more favorable terms than previously.
"It’s a beautiful time to get into business, a fabulous time," he said. "People are starting to recognize it; they’re listening to the Clark Howards of the world and realizing they’re not going to find a job that they’re going to be able to sink their teeth into."
Pamela Maxwell, business license and code enforcement coordinator for Newton County, said she’s seen a slight increase in the number of Home Occupation Licenses, particularly for internet-based business such as consulting, freelance services, internet research, arts and crafts and online auction selling. The home-based business is popular because of its low overhead, and people are trying to incorporate that idea into all of their businesses, whether they from work home or at a store.
Newton County resident Joycelyn Reid previously owned two restaurants that had to close when the economy tumbled. Rather than work in another restaurant, she decided to tweak her career and start a catering company. She still has a store to prepare the food, but she delivers all of the food to off-site locations, which vastly decreases her overhead costs. She hopes she’ll now be able to turn a profit and stay in the industry she loves.
"In this economy, because it’s so hard to find a job, if you were self employed for years, it’s also harder for you to find a job out there, because you don’t have that work experience out there in the job market that people are looking for. It’s easier for you and better to create a job for yourself," Reid said.
Even the previously retired are getting back into the job market, because many are finding they don’t have enough money to live comfortably. The Rev. Warren Williams, the interim pastor at Pleasant Grove Baptist Church, opened up Deacon’s Corner, a Christian-themed literature and variety store in Newton Plaza.
A former truck driver for many years, Williams has never owned his own business. He said he’s spent about $5,000 so far getting the business up and running, but he hopes he’ll soon be able to start making money and promote his faith in the process.
"Yes I’m taking a risk," Williams said with a laugh. "But I’m retired, and I needed something else to do. God directed me to open up a store of this sort, selling Christian literature. I’m trying to do something to earn a little extra money … and help people at the same time."
No matter what path entrepreneurs take, they often need help. Mesquita said his organization, SCORE, provides free advice and counseling to small business owners and is a great place for prospective owners to start. SCORE has offices in Henry and Rockdale counties. The Covington-Newton Chamber of Commerce also has several small business resources to help people put their ideas into motion, Chamber President John Boothby said.
But often a friend can provide the best help of all. Powell said she wouldn’t have been able to get her business started without financial and emotional support from her friends and her landlord who gave her a great deal and offers support and advice. She estimated that she’s received about $10,000 in equipment and money from friends, more than a third of her total costs.
"My friends and the owner have been such a blessing," Powell said. "I couldn’t get a loan and Mr. Bob (the property owner) gave me a good price. Someone else put in a bid of some restaurant equipment for me. People have been helping me so much. I couldn’t have done it by myself."