I think we over estimate the impact startups have on job creation. The recent home runs (google, facebook, zynga, groupon) have created astonishingly large value with relatively few employees - a few thousand on average. Startups are good at creating wealth, but not necessarily jobs (we still have record level unemployment in silicon valley). Our country needs to put millions of people to work; the 20k jobs created by startups are not going to solve that problem.

Theoretically, the unemployed workers can adapt to the "new economy" and re-establish themselves. Empirically, however, that's not happening.

Startups are more likely to aid the jobless via welfare (from tax revenue) than by actually employing people.