The Future Hinges on Young Entrepreneurs, but Can They Find Work?

Follow: , , , ,

As a way to reverse harrowing global youth-employment numbers, youth entrepreneurship is seen as a bright light at the end of a very long tunnel. But how viable of a solution is it?

ISTANBUL, Turkey — The numbers are terrifying. According to recent research conducted by The Economist, around 24.4 percent, or about 290 million, of the world’s young people are currently unemployed. No wonder they’ve been dubbed the Jobless Generation.

In global conferences—where policies and ideas about young people, business and development are laid forth and discussed—the young themselves are often forgotten. It is as if the next generation is simply affected by policies created by the older ones, instead of taking part as policy makers. Fortunately, this was not the case at the 16th International Business Forum in Istanbul.

The young 16th International Business Forum attendees soak in info on sustainable growth.

Photo courtesy of IBF

The young 16th International Business Forum attendees soak in info on sustainable growth.

“It is without a doubt that youth play an important role in inclusive business, as most of the startups come from them,” said Hansin Doğan, deputy director of Istanbul’s International Center for Private Sector in Development, part of the United Nations Development Programme. Yet, although youth entrepreneurship is often seen as a solution to mass unemployment among the young, it is far from a panacea.

In the world’s fastest-growing economies—like China, India and even Turkey—young people aged 15 to 30 make up almost half of the population. Yet they face considerable barriers if they wish to set up their own businesses. “There are many great ideas from young entrepreneurs, but lack of skill makes it difficult for them to be implemented,” Doğan said.

Young entrepreneurs who came to the forum in Istanbul shared a similar view.

“Our main challenge in doing business is that we don’t have the business skills needed,” said Salinee Tavaranan, founder of SunSawang, a business that provides affordable solar energy systems for rural areas in Thailand.

Indeed, entrepreneurial skills are one of the main challenges for young people planning to start an inclusive business. “Starting a business needs skills; you cannot learn it by doing. It’s very challenging for youth because they need not only skills but also mentorship, compliance and access to finance,” Doğan said.

Many organizations are now emerging to help young people become entrepreneurs. One of them, Job Skills, a Canadian nonprofit, offers a Youth Entrepreneurship Program that provides resources and skills for any business, which can range from copy centers and general contracting to dog treats and rock bands.

“The program assists unemployed youth between the age of 15 and 30 who are out of school and out of work,” said Sandra Ponting, business services and programs coordinator at Job Skills.

“For 24 weeks, we taught them how to set up their business plan, [conduct] market research [and deal] with finances, management skills and operating their business,” Ponting explained.

The importance of fostering entrepreneurs under 30 is emphasized not just by grass-roots NGOs but also by large economic and development organizations, such as the Organisation for Economic Co-operation and Development.

“In OECD, we view young entrepreneurs as a driver in local economic development, as well as in innovative solutions,” said Cristina Martinez-Fernandez, the OECD’s senior policy analyst on employment and skills.

To reduce the high number of unemployed young people, many countries are aiming to give them better access to self-employment. “In some [OECD] regions, youth entrepreneurship is part of their strategic policy for economic development,” Martinez-Fernandez said.

This eagerness to help young people start their own businesses has been translated into specific policy frameworks for youth entrepreneurs. For example, the OECD’s Local Economic and Employment Development program, or LEED, focuses on analysis and evaluation at the local level of entrepreneurial activities, particularly in entrepreneurship education.

Some European countries already have policies aimed at promoting youth entrepreneurship. One good example is the United Kingdom’s Think Big program, which has been replicated in Germany, Ireland and Slovakia. The program was established in 2009 to engage and inspire young people to launch local projects that make a positive impact on their communities.

Hands Up Who’s Bored is an example of a project supported by the Think Big program in the United Kingdom.

Through training and grants, Think Big works to give young people a chance to turn their entrepreneurial idea into something they can be proud of. According to its website, more than 2,500 projects from almost 30,000 young people across the United Kingdom have been supported by Think Big.

Nevertheless, to support entrepreneurial activities as early as possible, formal institutions must still play an important role.

The United Nations Conference on Trade and Development Entrepreneurship Policy Guidelines stress “the importance of raising awareness to school students about self-employment as a viable career option,” said Tatiana Krylova, head of the Enterprise Branch Division on Investments and Enterprises at UNCTAD.

To raise awareness of entrepreneurship at an early age, basic skills in economics, marketing and local commercial law can be introduced in classrooms. “Implementation of extracurricular activities, including visits to businesses, also proved to have good results for students,” Krylova said.

“I believe the role of youth entrepreneurs in sustainable businesses is going to be bigger,” Martinez-Fernandez said, “since entrepreneurship for young people [is] already part of strategic policy for development in some countries. Now it is also about how well young entrepreneurs [organize] themselves and [about] establishing a global network.”

Young entrepreneurs at an event hosted by somewhereto_, another enterprise supporting entrepreneurship across the United Kingdom.

Photo courtesy of somewhereto_

Young entrepreneurs at an event hosted by somewhereto_, another enterprise supporting entrepreneurship across the United Kingdom.

Undoubtedly, the future of sustainable business relies greatly on how much young people are involved in it. Unfortunately, present government policies are not enough to start the chain reaction needed to increase entrepreneurship among them. According to recent data from the World Economic Forum, the quality and relevance of education is still a major reason for youth unemployment. Without increasing the relevance of education systems, the effectiveness of entrepreneurial policies for the young may be disrupted.

The WEF’s Global Agenda Council on Youth Unemployment says high population growth, recurring economic crises and a discouraged youth population are some of the main challenges in combating the high rates of unemployment. Despite many initiatives taken by numerous organizations and policy makers, the issue is far from resolved.

Leave a Reply

Your email address will not be published. Required fields are marked *