Word: auto
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Dates: during 2000-2009
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...fact that French private enterprise is surging in the middle of the world's worst economic crisis in 50 years is as surprising as its cause. The motor driving all that bustling start-up action is an innovation known as auto-entrepreneur, a government scheme introduced in January to help would-be bosses bypass the formidable process of founding a small business. The scheme cuts through the jungle of administrative red tape usually required to launch a company, and dramatically lightens the heavy taxes and social charges companies pay. While other firms face set charges whether business is booming...
...surprisingly, the scheme has accounted for more than half of all new companies founded thus far this year. "The auto-entrepreneur plan has been an impressive success, beyond what we'd been counting on," noted Hervé Novelli, secretary of state for small- and medium-size businesses, in late July...
There are some caveats to the scheme's accomplishments. First, it's primarily aimed at individuals who already have jobs, or at unemployed or retired people who yearn to try their hand at a service they think might find a market. Because of that, new companies created by auto-entrepreneurs start out as single-person operations - and usually as part-time or moonlighting ventures. If business starts booming, neophyte owners who take on employees have to register under the normal labor regime, which means assuming the taxes and salary-linked social charges that prove so dissuasive to many would...
Those growth limits can be frustrating for first-time business people. "I'm already on target to reach the income limitation for auto-entrepreneurs by September," says Isabelle Prigent-Chesnel, a 36-year-old communications consultant who in May decided to found a freelance business through the scheme rather than return to her salaried job after the birth of her second child. "That means I've got a decision to make about where to take this. I'm finally doing only the work I enjoy, but would have never launched into on my own before...
...Though auto-entrepreneurs like Prigent-Chesnel praise the program for allowing people to become their own bosses, they also say the limitations it imposes on start-up businesses means it won't create jobs for enough of France's 2.4 million registered unemployed. And even if most of the projected 500,000 new companies launched this year wind up prospering, their tiny size isn't going to make a big dent in the country's economic decline in 2009, which economists estimate will be at least 3%. (See pictures of the Top 10 scared traders...