BY ALEX BROWN | PIVOT WRITER
Canadian youth face a very discouraging outlook when entering the job market. Dubbed “The Forgotten Generation” and “Generation Jobless” in a recent CBC documentary, millennials in Canada feel increasingly disenfranchised with the education system in which they invested time, money and faith in order to secure their dream job.
There are a myriad of factors that contribute to this pattern, but Lauren Friese, Founder and CEO of Talent Egg said one of the biggest issues that contribute to the problem is a lack of preparedness. “For example, universities regularly advertise 90%+ employment rates after graduation, giving students a false sense of security,” she said.
She identified other factors such as a lack of willingness among employers to train students from diverse background, and misguided government funding and action in relation to the problem.
A recent study from Intuit Canada shows that youth unemployment is double the national average at 14.1%, and 25%-30% of university educated millennials work at jobs for which they are overqualified. Graduates carry an average debt load of $28,000, and thus around 51% have moved back home to live with their parents.
With the aforementioned figures in mind, it is no wonder that there are approximately 1.2 million millennials considering opening their own business within the next year. With millennials expected to occupy approximately 75% of the labour force by 2028, and their growing interest in entrepreneurship, the need to support and cultivate millennial entrepreneurs can no longer be ignored.
The Startup Generation
In Canada, the unfavourable labour market conditions are fostering the desire amongst millennials to investigate entrepreneurship as a viable career option, and this climate is breeding a new global startup generation. Intuit’s poll of more than 400 young entrepreneurs indicated that millennials are twice as likely to open up their own business when compared to the rest of Canadians.
Young people are increasingly drawn to entrepreneurship and the idea that they can carve out their own future as opposed to allowing the lacklustre labour market to dictate their future. Julia Deans, CEO of theCanadian Youth Business Foundation (CYBF) noted that they “have seen a significant lift in the number of applications for their programs since 2009, and since 2012 this demand has grown by 20% annually.”
Overwhelmingly the motivation for becoming an entrepreneur among millennials has less to do with compensation then it does an individual’s ability to control their own destiny. Intuit’s data indicated that over 78% of millennial entrepreneurs are motivated by the opportunity to chart one’s own course, with 21% citing the ability to focus on one’s passion as their core motivation.
The tools available to young entrepreneurs have never been so robust as they currently are.
“Never before has it been so easy for someone to start a business,” said Adeo Ressi, CEO of the Founder Institute, at the recent Global Entrepreneurship Summit. “The tools that are available at your fingertips are vast and incredibly valuable. The network that you can command at the click of a mouse can help you overcome nearly any challenge you may be facing. This truly is the age of the entrepreneur!”
A growth of online communities, mentoring opportunities and free tools and resources is helping young entrepreneurs get started on the right foot. For example, right now Intuit Canada is offering Quickbooks Online for free to any Canadian startup and is running weekly Google Hangout sessions that discuss tips and tactics for growing your business. It is also running a blog series titled ‘What I Wish I Knew’, where top Canadian entrepreneurs like Kerry Morrison, CEO of Endloop Mobile, share their secrets to success.
For tech startups, Microsoft’s BizSpark Program offers free software, support and visibility to get startups off the ground. Building community is a big part of this international program, and participants share their experiences through BizSpark’s Startup Stories section of its website.
Mentorship is another key resource for young entrepreneurs. With that in mind, this November, young entrepreneurs will have more opportunities than ever to connect with and learn from a mentor during theCanadian Mentorship Challenge, happening during Global Entrepreneurship Week (Nov 18 – 24). Powered by Startup Canada and CYBF, the week-long Challenge is hosting a number of in-person and virtualmentoring events across the country. For young entrepreneurs just starting out, finding and learning from a mentor can be key to setting them on the right track.
The resources available to millennial entrepreneurs are vast, helping to mitigate some of the risks involved in starting a new venture. Intuit ProAdvisor Marnie Stretch said the risk of starting a new business has definitely changed over the last few years, especially when it comes to an online venture. “Startup costs can be quite affordable and the mindset of the younger generation is often just to jump in and test the waters rather than getting bogged down with a lot of analysis and planning,” she said. “Of course that isn’t always the case, but I feel that as a group, they’re more tolerant of risk.”
Entrepreneurship and Job Creation
As part of its overview of the State of Entrepreneurship in Canada, Industry Canada underlines that entrepreneurship benefits all Canadians. “Entrepreneurship is a powerful force driving innovation, productivity, job creation and economic growth,” reads the website. Millennials opening businesses increases opportunities for other young Canadians to find work, and with the advent of new technologies, millennial startup ventures have the potential to create jobs that previously did not exist.
Although entrepreneurial job creation may sound like an oxymoron, not all millennials are comfortable charting their own course. Thus, entrepreneurs are fantastic engines for job creation, and Small and Medium-sized Enterprises (SMEs) are recognized as a powerful force in alleviating youth unemployment. Deans notes that the CYBF average of five jobs created per entrepreneur in their programs has remained constant through the massive spike in demand that they have experienced.
Stretch, through her ProAdvisor role, has witnessed a strong Do-It-Yourself (DIY) mentality among young entrepreneurs. “They start out taking on a lot of the responsibilities of their business, including the data entry. But after some time, confidence, and eventually some growth, they not only want to delegate but need to build a team of people around them.”
The vast majority of businesses need to build and grow a team in order to maintain growth, so empowering young entrepreneurs with the tools for success is an important way of supporting job growth.
Youth Entrepreneurship and Unemployment
The current labour market conditions are creating a perfect storm for the acceleration of the Startup Generation`s rise to prominence in Canada.
With the advent of countless technologies and the formation of some incredible organizations, millennials enjoy the most favourable conditions for undertaking entrepreneurial ventures that the world has ever known. With this massive growth in entrepreneurship as a career path, the Startup Generation is also a powerful force in job creation in Canada as their ventures grow and require team building as a means of expansion.
The importance of supporting young entrepreneurs in Canada and globally cannot be overstated, and this support should be prioritized as a strategy for alleviating the youth unemployment/underemployment crisis.
Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.