The U.S. Poverty Rate

According to the U.S. Census Bureau, the poverty rate for 2005 was 12.6 percent or 37 million people. Of the people living in poverty, 12.9 million were under 18 years of age—17.6 percent of American children and adolescents. Life is difficult for children growing up in poor families from the moment of birth. Poverty and poor health often go hand in hand. Poor mothers are more likely to have low birth weight or premature babies, who are more likely to develop health problems as children. Moreover, these children are more likely to have an inadequate diet and to be exposed to environmental hazards, violence in the neighborhood, and parental depression and substance abuse. When they enter adolescence, poor children are more likely to develop depression and other mental illnesses. They also have higher rates of smoking and other behaviors that pose health risks.

Being raised in poverty also fosters conditions that can affect intellectual development and school performance. Poor families must often settle for inferior childcare, and children get little exposure to language and math in day care or at home. Poor children tend to enter school with fewer academic abilities, have more difficulty concentrating on their work, and higher rates of absenteeism and behavior problems. They have lower test scores in reading and math than other children and more often are held back to repeat a grade. The problems compound in adolescence, as poor youths are more likely to drop out of high school and get involved in delinquent activities.

Sources:

• Child Trends Data Bank. “Children in Poverty.” (accessed May 24, 2007).

New Businesses and Business Failures

Entrepreneurs face a variety of problems when they try to start a company. But there are resources available to help them get their businesses off the ground. Often entrepreneurs know little about business, even though they know a great deal about their field. In many areas of business—such as technology, medicine, and energy—there are organizations that assist and mentor entrepreneurs. Some organizations give advice on managing and financing a company, legal concerns, and marketing. Others link entrepreneurs with potential investors and clients.

Another way entrepreneurs can improve their chances of success is by looking at the business climate of different states. Some states do little to help startups. But other states, such as Wyoming, are eager to attract new companies that can grow and create jobs. These states give incentives to businesses that locate in them. These states help by building infrastructure, providing funds for training workers, or providing tax breaks. Information is available on the different states’ Web sites.

Sources:

• Pennsylvania Open for Business. Financial Incentives.
• “‘Launch: Silicon Valley’ 2007 Puts Spotlight on Top Tech, Life Science and Energy Startups for Audience of Leading Investors and Corporate Executives.” PR Newswire, March 13, 2007.
• “Global Medical Group Unveils a Host of Services for Startup Pharmaceutical and Medical Device Companies.” PR Newswire, March 13, 2007.
• “Aerospace startups ditch Colorado for Wyoming, $6 million incentive package.” Denver Post, (Denver, CO), March 24, 2006.

Partnerships

Business people can form a general partnership simply through an oral agreement, without signing any papers. In some states, they can even form a limited partnership this way. Most states, however, require that limited partnerships have a written agreement that spells out each partner’s responsibilities, and business people often encourage entrepreneurs to prepare written agreements for general partnerships as well.

A written agreement can settle many potential conflicts ahead of time. For example, it can establish how decisions will be made, how profits will be shared, and each partner’s degree of liability. A written agreement can also set down how much authority each partner will have and how disagreements will be settled. In a case where two partners each own half of a business, they could designate a neutral third person as owner of one percent of the business who could act as tie-breaker in case of a dispute. In addition, an agreement can also determine how those who remain will pay a partner who decides to retire or leave the business for his or her part.

Source:

• Spadaccini, Michael. “The Legal Ins and Outs of Forming a Partnership.” Entrepreneur.com.