55% of entrepreneurs worldwide expect to create at least one job in the next five years—this according to the Global Entrepreneurship Monitor (GEM) 2016/17 Global Report released today by Babson College.
Yet globally, many factors are in play that could hinder such entrepreneurial growth. These include sophisticated technologies and communications that may enable entrepreneurs to operate on their own, rigid labor regulations, poor availability of skilled or educated labor, limited access to entrepreneurial finance, and the decision to stay small to avoid the complexities of formalization.
“The power of entrepreneurship to create jobs demonstrates its crucial importance to economic growth and stability around the world,” said Babson College Professor and GEM U.S. Team Lead Donna Kelley. “Whether this means alleviating regulatory burdens or offering specialized financial support, policy makers and private stakeholders will need to direct their attention toward policies and practices that can together strengthen the ecosystem that supports the efforts and ambitions of entrepreneurs.”
GEM countries in the 2016 survey cover 69.2% of the world’s population and 84.9% of the world’s GDP. In its 18th consecutive year, the report continues to serve as the largest single study of entrepreneurs in the world.
According to the Global Entrepreneurship Monitor (GEM) 2016 Global Report, over the past year, entrepreneurial activity remained stable or increased in approximately two-thirds of all economies surveyed in both 2015 and 2016; more than two-thirds of all adults see entrepreneurship as a good career choice, and the same believe entrepreneurs are seen as high status.
60% believe entrepreneurs receive positive media attention. Among the highest levels reported are China, Thailand, and Indonesia, where more than 3/4 of adults see positive media attention for entrepreneurs, Greece, India, and Mexico report around half this level.
“Societies that value and promote an entrepreneurial culture are more likely to innovate, which in turn, creates long-term economic growth,” said Babson College Professor and GEM U.S. Team Member Mahdi Majbouri. “In the U.S., for example, entrepreneurs are often seen as celebrities and highly admired. It is clear, especially here, that positive media attention makes a valuable contribution to the entrepreneurship ecosystem. Enhanced visibility for entrepreneurs provides others with reputable role models, and points them in the direction of networks and resources. Such access could make the difference between a potential entrepreneur and an intentional one.”
On average, 42% of all working-age adults see good opportunities around them for starting a business. This perception is just about equal across all economic development levels, with only a 3% difference between factor-and-innovation-driven economies.
North America reports the highest rate of opportunity perception at 58%, however, this does not translate into robust entrepreneurial intention. Only 13% of North Americans intend to start a business in the next three years.
On the other hand, North America demonstrates the highest overall rate of entrepreneurial activity within existing organizations – 6.5%. This behavior, called Entrepreneurial Employee Activity (EEA), includes the development and launch of new activities for an individual’s main employer, and accounts for more than half the average Total early-stage Entrepreneurial Activity (TEA) in innovation-driven economies. Africa reports the lowest rate of EEA at just 1%.