To understand the current health of the economy, it is critical to understand the state of new-business creation. New firms create most net new jobs. Because of the emerging sizes of two demographic groups—Baby Boomers and Millennials—these generations will have the largest impact on entrepreneurship in the United States in coming years.
In an article on Forbes.com, Jordan Bell-Masterson and E.J. Reedy, members of the Kauffman Foundation's Research and Policy team, identify the entrepreneurship challenges and opportunities that these groups face.
Read an excerpt of the article below.
What Millennials Have to do With Fiscal Policy
For the Boomers, we might tell an optimistic story because that generation has already been remarkably entrepreneurial, and advances in healthcare mean that the aging Boomers need not slow down that economic participation like previous generations.
On the other hand, the Great Recession robbed many older families of their hard-earned wealth, and we know that median household net worth for this age group is lower today than for similar households in the mid-1980s.
Without as large a pool of working capital as before, Boomers may be more averse to the risks of entrepreneurship than they were pre-recession.
As for the Millennials, the overall story tilts negative. While there is something to be said for increased entrepreneurial exposure (both informally in the home and formally in schools), we don't yet know if the explosion in entrepreneurial education will amount to anything.
Meanwhile, the negative trends are much more visible and already here. The twin menaces of student debt and the Great Recession have thrown Millennials into a hole, making it unprecedentedly difficult for that generation to amass wealth as well as relevant industry experience—each necessary to create successful entrepreneurs.
Read the rest of the article on Forbes.com.