Category Archives: entrepreneurship

Millennials: Not So Entrepreneurial

Earlier this month I wrote about some surprising research that suggests many millennial workers defy the slacker stereotypes and are apt to be workaholics.

ThinkstockPhotos-485914233Here’s another surprise: It turns out that millennials are shaping up to be less entrepreneurial than previous generations, too. That defies not only the general preconception about this generation, but the millennial self-image as well.

Add these findings together and we may be getting a glimpse of the future: Millennial workers, if treated right, may turn out to be more industrious and loyal to their employers than anyone imagined.

The entrepreneurship data came early this year in a study by the Small Business Administration that didn’t get as much attention as it deserved. Credit goes to the Economic Innovation Group and EY for highlighting the data in September along with results of their own survey of millennial workers. (Hat tip also to the Washington Post’s Wonkblog for reporting this first.)

millennial-entrepreneursSBA economist Daniel Wilmoth’s study, published in February, used Census data to look at self-employment rates by age for three generations: millennials (born after 1981), Gen-Xers (1963-1981) and baby boomers (1944-1962). In short, he found that self-employment rates declined for each succeeding generation (see graphic above) .

“At age 30, less than 4 percent of millennials reported self-employment in their primary job in the previous year, compared with 5.4 percent for Generation X and 6.7 percent for baby boomers,” Wilmoth writes.

Of course, self-employment isn’t quite the same as entrepreneurship. And each generation grew up in different economies, with different technology. And we don’t know what may happen as that generation ages. But I think this research provides persuasive — and surprising — insight into millennial workers.

Those of us who  — ahem — happen to be in an older generation may not be the only ones surprised. Millennials might be as well. The Economic Innovation Group survey found that 55 percent of millennials surveyed believe their generation is more entrepreneurial than those that came before.

And 62 percent said they’ve considered starting their own business. But 42 percent said they can’t afford to take that step.

Little wonder: It’s well known that millennials have higher student-debt loads that previous generations did at comparable ages, and that their entry into the job market often was hampered by the Great Recession.

So it’s not unreasonable for employers to be optimistic about millennial workers. They may not turn out to be the job-hopping, disengaged, self-centered population some have imagined. If nothing else, this number from the Economic Innovation Group survey should be encouraging: 88 percent of millennials agreed that “hard work is an important factor to get ahead in life.”

 

 

 

 

 

Are Job Seekers Saying No to Entrepreneurship?

Despite all you’ve heard about the rise of the entrepreneur and the growing number of young job seekers striking out on their own 451846939 -- younger workersrather than adhere to today’s workplace status quo, Challenger Gray & Christmas says not so fast.

The Chicago-based outplacement and career consultancy posted on its site recently a somewhat surprising report indicating job seekers today are actually risk-averse and are shunning entrepreneurship, even in this much-improved economy.

“Now that the economy is finally hitting its stride, one might expect a surge in start-ups,” says John A. Challenger, chief executive officer of the company. “While the percentage of unemployed managers and executives starting businesses has, in fact, increased, the survey results suggest that the severity of the recession [albeit over] had an adverse impact on would-be entrepreneurs, who appear to be far more sensitive to risk.”

Given the bulk of job seekers and newly-hired workers are younger — and given the results of a recent EY survey that Senior Editor Andrew McIlvaine posted about on May 7, finding millennials are getting fed up with the lack of flexibility in the current workforce — you’d think more of them would be setting out on their own.

Granted, the gradations in the Challenger report are fairly small, and it does indicate the numbers of entrepreneurs have, in fact, gone up since 2011:

“On average, just 5.1 percent of unemployed managers and executives started their own business in 2014, according to [the] quarterly survey of job seekers who found a position, pursued self-employment or retired.

“The 2014 start-up rate was down slightly from 2013, when it averaged 5.5 percent per quarter. However, both 2013 and 2014 rates were significantly better than the two previous years, when start-up activity averaged 4.2 percent in 2012 and 3.2 percent in 2011.”

But numbers are numbers, and 5.1 percent of unemployed Americans starting a business, in this economy, is surprising.

Especially considering all we’ve heard about the new age of self-employed self-starters … like this fairly recent account on the CNBC website. From the writer’s vantage point, there’s a whole lot of movement away from traditional employer-employee relationships. As the piece puts it:

“Watching the enormous success of companies like Facebook and Google — started by founders who were barely out of college — has dramatically altered the under-25’s sense of when it’s ‘right’ or ‘appropriate’ to pursue a good idea.”

It includes examples of some recent start-ups, some outside the United States, but not the numbers Challenger Gray & Christmas gives us.

Perhaps, as this HRE cover story from a year ago, “Leap of Faith,” suggests, maybe we’re not seeing as many entrepreneurs taking their dreams on the road because more employers are recognizing the power of innovation within their workforces and workplaces.

And maybe, for those millennials who want more flexibility but are staying put anyway, “intrapreneurship” is trumping work/life … at least for now.