Job seekers choosing to open their own businesses dropped to a record low, according to Challenger, Gray & Christmas, a Chicago outplacement firm.

Just 3.7 percent of high-level job seekers exiting the program were starting new businesses down from 7.6 percent in the first half of 2009 and 9.6 percent in the second half of last year, according to a survey conducted by the company on July 19.

Experts suggest that an improving job market and the difficulty getting small business loans may be steering people away from entrepreneurship, said Business Week.

Federal Reserve Chairman Ben Bernanke said last week that small businesses, and especially startups, are crucial to job growth and economic recovery. Bernanke once again called on banks to loosen credit to small businesses.

Some see the lower startup rate as a sign that the economy is improving. The unemployment rate is still high, but the private sector added 593,000 jobs in the first half of 2010, according the Bureau of Labor Statistics.

Startup activity typically increases as the economy improves, Challenger CEO John Challenger said in a statement.

President Barack Obama urged Congress on Tuesday to pass his $30 billion package to boost small business lending by pumping capital into independent banks. The plan, proposed in February, is an effort by the administration to spur job growth.

The banks that receive the money would pay the government a dividend, which would decline as their lending to small businesses increased, said Reuters.The president has also pushed for a number of small business tax credits as part of his economic agenda.

In his remarks to Congress, Obama said passing the measures “shouldn’t be a partisan issue.”

The House of Representatives Financial Services Committee approved its version of a bill to boost small business lending by a 42-23 vote last week, with no Republican support, said Reuters. The bill will be brought before the full House for a vote soon, said Speaker Nancy Pelosi.

The country’s unemployment rate is stalled just under 10 percent, and the president and other Democrats need to counter criticism from Republicans that they haven’t done enough to fix the economy before mid-term elections in the fall.

A drop in the November unemployment rate provided a glimmer of hope that the unrelentingly bleak job market may be headed for a turnaround.

The unemployment rate unexpectedly fell to 10 percent last month, from 10.2 percent in October, as employers cut the fewest number of jobs since the recession began. The average work week and earnings also rose in November, the Labor Department reported.

The economy shed 11,000 jobs last month, an improvement from October’s revised total of 111,000 lost jobs, and significantly better than the 130,000 Wall Street economists had expected in November, said the Associated Press.

Economists say that substantial job growth is needed to make a dent in the unemployment rate. According to the Labor Department, 15.4 million unemployed people are seeking work, and 11.5 million others are working part-time but want full-time jobs or have given up job hunting altogether.

In a troubling sign for small businesses, a survey by the National Federation of Independent Business showed more small companies plan to reduce employment in the next three months than plan to add jobs, said the AP.

When it comes to boosting budding entrepreneurs, look no further than the Tar Heel State.
According to a Feb. 13 report by bizjournals, North Carolina is home to two markets with the nation’s top ranking for “small-business vitality.” And by top, they mean the very top — Raleigh is No. 1 in the national rankings and Charlotte is No. 2. Bizjournals said it used a six-part formula to analyze the nation’s 100 largest metropolitan areas, searching for the places that are most conducive to the creation and development of small businesses.

Here’s why North Carolina is a leader even in tough economic times, according to bizjournals:

• Population: Raleigh and Charlotte together gained 427,000 new residents between 2002 and 2007. Raleigh grew by 21.2% in that five-year period, Charlotte by 17.4%. Both dwarfed the national growth rate of 4.8%.
• Employment: The two regions are cushioned from the recession by outstanding job growth during the 2003-08 span
• 23.0% in Raleigh, 15.4% in Charlotte. The U.S. gain was 5.8%.
• Small-business growth: The number of small businesses grew dramatically in both markets from 2005 to 2006, the latest period covered by official statistics. Raleigh posted a 4.6% rise, Charlotte 4.0%. The national increase was 1.3%.
• Small-business concentration: The typical U.S. market has 24.57 small businesses for every 1,000 residents. Raleigh was listed at 27.58 per 1,000, Charlotte at 27.07. Third in the “Top Five” ranking was Seattle, followed by Austin and Boise, Idaho. Detroit was last, battered by the decline of the automotive industry and high unemployment.

To see a slideshow on the Top Ten click here.