One of the persistent debates in the presidential campaign concerns the level of job growth/loss. It is a curious debate. On one hand, the unemployment rate is 5.4%. The only time it has been lower (since the ate has been measured and recorded) was a during few periods in the 90's. Right now we have one of the lowest rates ever. We're also in one of the largest economic expansions in 20 years -- when measured as a percentage of GDP -- which is the typical measure.

So why is there debate on this issue? One answer is the way employment statistics are measured. The Bureau of Labor Statistics uses the payroll survey to count employment/unemployment numbers. This means only jobs where someone hires another person or persons are counted as new jobs. What do not get counted are small business start ups. According to the Household Survey numbers there has been an increase in small business start ups. Folks seem to be opting for starting their own business -- whether full blown companies or small work at home schemes for second incomes -- instead of working for someone else.

Now, why in the last few years has there been an expansion in this area? Well, there has to be more and cheaper capital in the economy. Where would that come from? I suggest two places. One is the result of lower interest rates. Capital is cheaper, so the supply is greater. So, more folks are accessing capital in this manner. The other is the Bush Tax-Cuts. A lot of families used that money to start and expand businesses.

Think of one picture. A mom working outside the home who wants to be at home. She has four kids. Now she receives almost $4000.00 in tax credits she didn't have before. That is a good amount of capital. Invested wisely, it could be the basis of a business that would generate a second income.

The unwritten story is how many of these businesses will expand and create jobs for other people. It will take a year or two to see this appear in the economy. We will see what happens......