As efforts intensify to increase economic dynamism and the rates at which businesses scale or shrink and employees change jobs, we see more targeted education and support programs for entrepreneurs to a particular sector such as health IT or education startups, or a particular demographic group, such as women or youth (in its various definitions).
It is easy to see why policymakers and those designing and running interventions to support entrepreneurs want to be cautious about making their efforts unnecessarily complex by developing different approaches for one demographic group versus another. Surely most smart methodologies—Lean Startup theory, for example—apply to all nascent entrepreneurs or startups. However, when we start to examine why America is seeing declining rates of new firm formation, it matters a great deal. Which demographic is facing the biggest barriers? What pocket of Americans have the most potential for innovating through these volatile economic times by starting those new firms that will scale and employ large numbers?
This week we will see the spotlight focused on two specific demographic trends which are catching the attention of policymakers and entrepreneurship educators alike: the aging of baby boomers (born 1946-1964) and the maturation of Millennials (born 1981-1997).
I have previously written about the importance of older Americans. Senior entrepreneurs are a vital part of today’s economic model where individuals are no longer replaceable cogs in a system but rather autonomous sources for creativity and innovation. In fact, adults over the age of 50 comprise one of the fastest-growing groups of entrepreneurs in the United States, according to a new Gallup study. They are a hardworking generation that brings unique knowledge to founder teams, as well as previous startup experience and financial resources to help mitigate personal risk. However, older Americans were also hit by the recession and as boomers age they will clearly start companies at a slower pace.
Millennials also bring great promise. They are well-educated and hold generous value systems that suit creativity, team collaboration, new ideas and doing good while doing well. However, while they are maturing into peak ages for entrepreneurial performance they face severe debt.
The optimist in me sees these two demographic trends combined as a blessing to the American economy. They are of course compatible matches. The potential for founder dating across generations and demographics appears obvious – at least at face value. But here lies the challenge. We don’t know for sure. As with other questions around the economic dynamics of entrepreneurialism, we face a paucity of data and need better and more detailed benchmarking systems around demographics.
This week, the Kauffman Foundation’s sixth annual State of Entrepreneurship Address in Washington, D.C., promises to help by delving into these trends, discussing in much more detail how these two groups are shaping the levels of entrepreneurship in the country and what we can all do to improve our knowledge and understanding in view of economic growth objectives. You will hear both encouraging trends as well bad news about the ability of these two groups to turn entrepreneurial aspirations into new businesses. Perspectives offered at the event will include those of U.S. Secretary of Commerce Penny Pritzker and Small Business Administration Administrator Maria Contreras-Sweet. Americans can also vote not only on which demographic group they think will have the greatest impact on entrepreneurship, but more importantly what policy idea would be most beneficial to that group’s future success.
This year’s annual address will be streaming live online from 12 noon until 2:00 pm ET at kauffman.org/SOE2015. I encourage you to weigh in with your comments.
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