I'll tell you what's going on. It's a nightmare to hire someone. All the reporting requirements, all the paperwork involved, all the taxes and insurance requirements.
I certainly don't want to actually hire anyone unless I absolutely have to, and even then I will get "independent contractors" or use temps if i can first.
This sounds like a political statement. Obviously those sorts of requirements do exist, but they exist for everyone and in most cases scale as O(1) and not with employee count. They might plausibly be a barrier to hiring a first employee. They certainly aren't causing unemployment. As an existence proof, virtually none of those factors changed across 2008-2009, when we saw the biggest swing in employment rate since 1928.
> in most cases scale as O(1) and not with employee count
I've read in many places that startups and small businesses are a very important engine of economic growth in the US. Since that O(1) obstacle disproportionately hurts small businesses, it could serve as a long-term brake on growth.
But almost all "small" business are hobby ones that dont generate any large scale employment ie grow to several hundred employees.
In the UK the government pushes people to become "self employed" as it flatters the unemployment stats before that it was encouraging doctors to sign people of as disabled and on to a different benefit.
It's a political statement, though not obviously wrong.
For example, the US employer-provided-healthcare thing is an absurd burden on small businesses (and medium business, large business, and for that matter, the entire concept of labor mobility) that absolutely needs to go.
Of course, the better question to ask is more simple: how much is your time worth when it comes to hiring?
Because hiring takes time amount X, which presumably has value to you. But an employee will cost Y - somewhere on the order of say, let's say $50,000 - per year, in outgoing salary to them. So the question is, how large is X? How much money are you willing to spend hiring someone, considering that an employee, even if you had to do nothing, costs you $50,000 a year.
How much extra is it though? If there was a monetary cost to the extra paperwork, like paying someone else to handle it or accounting for the value of your own time. Would that be a significant fraction of the total cost of hiring someone?
I certainly don't want to actually hire anyone unless I absolutely have to, and even then I will get "independent contractors" or use temps if i can first.