Are publications about self-employment and entrepreneurship centered on young adults focusing on the wrong demographic? That is certainly what is suggested by the latest research released by the Global Entrepreneurship Monitor (GEM).
According to the GEM Special Report on Senior Entrepreneurship, which draws on data collected between 2009 and 2016 on entrepreneurial activity in 104 countries across five regions, entrepreneurial activity is far more likely to be undertaken by older people than the young.
The report, which also involved data gathered from Sub-Saharan Africa, found 18 per cent of those aged 50-64 and 13 per cent of those 65-80 are self-employed, both surpassing the 11 per cent of those aged 18-29 that work for themselves.
GEM said the data makes it clear that people of 50 years and older still have a significant role to play in economies around the world.
“Entrepreneurial success and prosperity has no age limits,” said Mike Herrington, executive director of GEM. “While the traditional perception of entrepreneurship is that it is a young person’s endeavour, the data is showing us that, in many aspects, older people are a significant entrepreneurial force. But this segment is largely an overlooked and undervalued resource.”
In spite of the fact there are more entrepreneurs in higher age groups, entrepreneurship programmes and support are, by and large, geared towards younger segments. The report suggests that specialised support for older entrepreneurs could help unlock benefits for economic stability – especially in economies where senior entrepreneurship is underrepresented.
Regionally, senior entrepreneurship – those aged between 50 and 64 – in terms of both entrepreneurial intention and early-stage entrepreneurial activity is highest in Sub-Saharan Africa.
According to Thomas Schøtt, professor of entrepreneurship at the University of Southern Denmark and lead author of the report, senior entrepreneurs bring with them a host of benefits – economic, social and environmental – that the report labels “golden dividends”. These include relieving pressure of an ageing population on the state and job creation.
“Every older adult who is self employed is less likely to place a financial burden on society and to contribute to the economy of that country through the payment of taxes and by remaining economically active. Additionally, senior entrepreneurs are marginally more likely than their younger counterparts to employ more than five people so they are not only creating jobs for themselves but for others as well,” he said.
Additional economic benefits come from the fact that senior and older people who act as informal investors also tend to invest considerably more money compared to younger adults. Almost two thirds of older business angels invest more than the median of all investments, while elderly entrepreneurs across all phases of entrepreneurial activity report substantially higher levels of satisfaction with both their life and their job, compared to elderly routine employees. This translates into better health and fewer demands being placed on social service/entitlement programmes.
Schøtt said that these findings are of particular significance to economies that are struggling with the perceived burden of an ageing population.
“With approximately 16 per cent of the world’s population 55 or older, the issues of entrepreneurial activity at these more advanced ages directly affect more than a 1.2 billion people. The world is beginning to understand how senior entrepreneurs with their wealth of work and life experience, deep networks, and eagerness to remain productive are a huge untapped resource,” he said.
“It is time that we stopped thinking about this demographic as a liability and instead recognise them as assets and work across sectors to help break down barriers to unleashing their potential. It is imperative for governments to create innovative, inter-agency frameworks to marshal resources, catalyse strategic thinking, prioritise new policy and create actionable research to advance this movement.”