Are Millennials Missing The Entrepreneurial Spirit?
September 19, 2016
“Millennials are on track to be the least entrepreneurial generation in recent history,” Dane Stangler, the Vice President of the Kauffman Foundation testified last week to the U.S. Senate. Stangler pointed out that the decline in entrepreneurship represents a national crisis requiring immediate attention from policy makers. As a millennial myself, I find this to be alarming.
The Small Business Administrationreported that in 2015, less than 2 percent of millennials reported self-employment, compared with 7.6 percent for Generation X (born 1963 to 1981). Moreover, over the past 20 years, the United States has experienced a steady decline in business startups. Trends suggest that entrepreneurship amongst millennials will remain low for decades.
American entrepreneurship is a comprised of a multi-dimensional group of people. Americans of various socioeconomic backgrounds start companies in different industries in different parts of the country.
This “startup deficit” has contributed to the sluggish employment recovery after the recession. A lower level of business creation has also dragged down the overall fluidity of the U.S. economy.
While American entrepreneurship has slowed, there are steps that lawmakers can take to remedy the decline. To rectify the headwinds and renew entrepreneurial growth in this country, Mr. Stangler suggest lawmakers address the following step:
(1) Scrutinize existing programs: There are 45 different federal government programs that aim to help entrepreneurs. Congress and administrative agencies should devote resources to understanding their effectiveness and where cuts might be possible. Lowering costs of entrepreneurial experimentation promises to foster more entrepreneurship than another government program.
(2) Reduce regulatory complexity:This would not only help entrepreneurs but American firms. While there are already special regulatory provisions that apply to small businesses, Congress should consider revisiting regulations that may have reduced the volume of lending to young people attempting to start firms.
(3) Invest in data collect:The best way to monitor the health of American entrepreneurship is through data. Additional resources should be considered to augment and expand these efforts.
Entrepreneurship is vital to the American economy and democracy. At AEO, we believe America’s best entrepreneurial days are still to come. In our Linking Young Adults To Microbusinessreport, we provide new pathways to economic opportunity to America’s youth by exploring all available options. This vision, however, will not become reality without the help and support of public policy. An economy that thrives from millennial entrepreneurship is a dream worth propelling.