This study investigates the effect of unemployment on the establishment entry rate. The expected relationship between unemployment and establishment entry is a negative quadratic relationship, where rising unemployment rates will contribute to increased establishment entry until the unemployment rate is too high, signaling a poor economy and causing establishment entry to fall. This study samples all counties in the United States from 2005 to 2015. The results show that there is a cubic relationship between the unemployment rate and establishment entry rate rather than a quadratic relationship. The cubic model has two turning points to reflect the relationship between unemployment and establishment entry. When the labor market is tight, there is a negative relationship between unemployment and establishment entry until the unemployment rate reaches 5.88%. Then there is a positive relationship between unemployment and establishment entry until the unemployment rate reaches 16.82%, where the relationship becomes negative again.