By Daniel Hunter
Young people in Europe are amongst the least likely in the world to feel positive about starting up a business, according to a report released today (Monday) by Youth Business International (YBI) and Global Entrepreneurship Monitor.
EU youngsters scored less favourably than their counterparts in Africa, the Middle East and Latin America when asked about the business climate for start ups in their country, their confidence in their own entrepreneurial skills and knowledge, fear of failure, and whether they see becoming an entrepreneur as a good career choice.
Just 17.3% of young Europeans believe there are good business opportunities available and that they have the skills and knowledge required to start a business. This compares to 60.0% in Sub-Saharan Africa, 40.0% in Latin America & the Caribbean and 30.0% in the Middle East & North Africa. Asia Pacific & South Asia was the only area to score lower, albeit only marginally at 16.8%.
Similarly, those aged 18-35 in the EU were much more likely than anywhere else in the world to report that fear of failure would prevent them starting a business. 41.9% cited fear of failure as a barrier, compared to just 24.0% in Sub-Saharan Africa and 27.7% in Latin America.
Although almost two thirds (61.2%) of young people in Europe think starting a business is a good career choice, this is dwarfed by the figures for their peers in Latin America (74.9%), the Middle East and North Africa (75.5%) and Sub-Saharan Africa (76.5%).
The findings from the Generation Entrepreneur? The State of Global Youth Entrepreneurship report — which surveys more than 198,000 people across 69 countries — come at the start of YBI’s Global Youth Entrepreneurship Summit, which takes place every three years.
The Summit - supported by Accenture, Barclays and BG Group — brings together over 300 experts in youth entrepreneurship from around 50 countries to share the latest thinking on how more young people can be encouraged and enabled to start their own businesses. Enterprise challenges being debated at the Summit include whether the markets are failing entrepreneurs and how to tackle the global youth unemployment epidemic.
“This report suggests that young people around the world have the will, but not the means, to become entrepreneurs. It’s worrying that whilst many young people do see good opportunities for starting up a business, most of those in Europe do not," Andrew Devenport, CEO of Youth Business International, said.
"At a time when we need more new businesses to help drive our economy forward, we want people to come together to support and encourage entrepreneurship in any way they can. That’s why Youth Business International is hosting the 6th Global Youth Entrepreneurship Summit.
"It enables countries from across the globe to learn from each other how young people can be enabled to become successful entrepreneurs. This is important if we are to be able to provide means for more potential young entrepreneurs to become successful entrepreneurs.”
Young European entrepreneurs are also notable by their absence in the shortlist for YBI's Young Entrepreneur Awards, supported by Barclays, which take place on the last day of the Summit. This year’s winners and finalists hail from countries including Bhutan, Sri Lanka, India and China but not from anywhere in Europe. In contention for the overall Entrepreneur of the Year title are Sharad Tandale from India, Prinson Thuraiaiya from Sri Lanka and Huaping Yang from China.
“Building on previous GEM findings, the report shows it is young people who are most active in enterprise — in fact we have learnt that enterprise activity increases from the ages of 18 to 35 (40 in some regions), then begins to tail off," Mike Herrington, Executive Director of Global Entrepreneurship Monitor, said.
"It is critical that we invest in the next generation of young entrepreneurs, at a time of such high youth unemployment in many countries and worrying social disenfranchisement."
Other key findings from the research include:
· The USA has the highest percentage (12.6%) of new or nascent business owners aged 18-35 with high growth expectations.
· Young people in Asia Pacific & South Asia are most likely, and young people in Sub-Saharan Africa least likely, to make use of an online trading environment.
· Young entrepreneurs in all regions of the world perceive themselves, on average, to be more innovative than adults with respect to the extent to which their product or service is new to some or all customers and where few or no other businesses offer the same product.
· In sub-Saharan Africa (77.7%), Latin America and the Caribbean (75.7%) and Asia Pacific and South Asia (73.2%) approximately three-quarters of youth new or nascent businesses are primarily reliant on personal/family or friends for funding to start a business.
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