(Kuala Lumpur, Malaysia) January 17, 2013 – The Global Entrepreneurship
Monitor (GEM) 2012 Global Report estimates that nearly half of the
are between the ages of 25 and 44. The survey also reports that, in all
geographic regions surveyed, 25-34 year olds showed the highest rates
of entrepreneurial activity.
"Although most of the entrepreneurs tend to fall into the early to
mid-career age ranges, we see people participating in entrepreneurship
at all ages," commented Donna Kelley, co-author of the report and
Associate Professor of Entrepreneurship at Babson College.
"Encouragingly, in every part of the world, youth are starting
businesses as well as those in their late careers. Given this broad
spectrum of participation, some economies may be well-served by looking
more closely at certain age groups in order to determine
how to encourage and support entrepreneurial activity. Whether it be
educated youth in a society unable to find jobs to apply their skills,
mid-career workers suddenly unemployed, retirees wanting or needing to
continue earning income, or individuals of any
age that recognize opportunities and have the desire to be
entrepreneurs, people have particular strengths they can leverage at
various points in their careers, but they are likely to need different
training and resources to effectively engage in entrepreneurial
Latin America/Caribbean and sub-Saharan African regions tend toward
older entrepreneurs, with one-third falling into the 45-64 age range. In
Europe, on the other hand, the non-EU
economies report, on average, that half of the entrepreneurs are
between 18-34 years of age.
China was also distinct in claiming a high proportion of young entrepreneurs, with 57 percent between 18 and 34 years of age.
Unveiled today at the GEM Annual Meeting in Kuala Lumpur, Malaysia, this
is the 14th annual survey of entrepreneurship worldwide and is the
largest single study of its kind.
GEM Global report is authored by Siri Roland Xavier, Associate
Professor, Deputy Dean and Program Director for Entrepreneurship, Bank
Rakyat School of
Business and Entrepreneurship, University Tun Abdul Razak in Kuala
Lumpur, Malaysia; Donna Kelley, Associate Professor of Entrepreneurship,
Babson College, Wellesley, MA, USA; Jacqui Kew, Senior Lecturer,
College of Accounting, University of Cape Town (UCT),
Cape Town, South Africa; Mike Herrington, Director, UCT Centre for
Innovation and Entrepreneurship, Graduate School of Business, Cape Town,
South Africa; and Arne Vorderwülbecke, Research Fellow and Doctoral
Candidate, Institute of Economic and Cultural Geography,
Leibniz Universität, Germany.
In the late spring and early summer of 2012, more than 198,000 adults in
69 economies took part in the GEM survey. With the largest sample to
date, this group of economies represented an estimated 74 percent of the
world’s population and 87 percent of the GDP.
The GEM 2012 Global Report also looked at cultural attitudes about
entrepreneurship. Perceptions about entrepreneurial opportunities,
capabilities, fear of failure, and intent to start a business are key
predictors of entrepreneurial activity around the world.
"We are finding that entrepreneurship education and media attention
about entrepreneurs may have a lasting effect on cultural attitudes
about entrepreneurship," Kelley stated.
The full report can be accessed (http://www.babson.edu/academics/centers/blank-center/global-research/gem/pages/home.aspx ).
Available Jan. 17th, 12:01 am.
Among The Report’s Key Findings:
Perceived Opportunities and Capabilities
•Entrepreneurs in sub-Saharan Africa ─ factor-driven economies in the
earliest stage of economic development ─ had high perceptions about good
opportunities for starting businesses within six months (70 percent),
and beliefs that they have the skills and knowledge
necessary to start businesses (76 percent). Their high Total
Entrepreneurship Activity rates (TEA) are consistent with these positive
•Positive attitudes are higher in Latin America than in non-European
Union economies. Both regions are within the middle-stage
efficiency-driven group of economies (developing economies where
industrialization has taken hold). This difference shows how attitudes
towards entrepreneurship are shaped by more than a country’s level of
•Noticeable variations in attitudes can be seen within geographic
regions. The wealthier economies in the AsiaPacific/ South Asia regions ─
Japan, Republic of Korea, and Singapore ─ show lower than average
opportunity and capability perceptions while earlier
development-stage countries like China, Pakistan, and Thailand scored
•As economies develop, perceived opportunities and capabilities tend to
decline. Perceived opportunities were almost twice as high in
factor-driven vs. innovation-driven economies.
"The GEM Global report clearly shows that perceptions are critical. GEM
looks at perceived opportunities, perceived capabilities, and intentions
to start a business. We measure and analyze the differences among a
wide range of geographic regions and economic
levels,” said the report’s coauthor Mike Herrington.
Fear of Failure
•Economies in sub-Saharan Africa had the lowest levels, with just 24
percent reporting that fear of failure would prevent them from starting
new businesses. Latin America and the Caribbean economies were also
confident with only 28 percent stating fear of failure concerns.
•Fear of failure increases as economies move from early-stage to
advanced development levels. Malawi (12 percent) has the lowest rate
while Greece (61 percent) and Italy (58 percent) reported peak levels.
•Intentions are highest (48 percent) in factor-driven economies
(characterized by low-cost labor, natural resources, exports) and
decrease significantly in the efficiency-driven (26 percent) and
innovation-driven groups (11 percent).
•The sub-Saharan Africa region ranked highest in intentions (53 percent) among every geographic region in the world.
•Positive perceptions about opportunities do not always translate into
starting businesses. 30 percent of respondents in Asia saw opportunities
but only 17 percent expect to actually start businesses in the next
Beliefs About Entrepreneurship
•Entrepreneurship as a good career choice and the belief that it is a
high status choice, or one that receives media recognition, varied among
cultures and regions. There were high rankings for these attitudes in
the Latin America/Caribbean, Middle East/North
Africa (MENA), and sub-Saharan Africa regions.
•European Union (EU) attitudes were lower. Only half of the respondents
agreed that entrepreneurship was a good career choice and received
positive media attention still, two-thirds think of entrepreneurship as a
•Total Entrepreneurial Activity (TEA) measures the percentage of adults
(ages 18 -64) who are nascent (potential) or new entrepreneurs. TEA
rates are higher in economies with low GDP per capita and lower in high
GDP economies. This ratio corresponds with high
levels of necessity-entrepreneurship (no other work options available)
in low GDP countries while high GDP countries exhibit higher levels of
•At 27 percent, Zambia (sub-Saharan Africa) and Ecuador (Latin
America/Caribbean) submitted highest TEA rates in these regions. The
Asia Pacific/South Asia region showed a mix of TEA levels with Thailand
(19 percent and China (13 percent) leading the way.
•Innovation-driven economies have more established business owners than
entrepreneurs. Greece, Spain, Switzerland, Ireland, and Finland in the
EU; and Japan, Republic of Korea, and Taiwan in Asia have one-third more
established business owners than entrepreneurs.
Non-EU and MENA groups have low rates of both TEA and established
business ownership while sub-Saharan Africa has high rates of both.
•Business discontinuance also varied across regions. Lack of financing
was the most common cause in sub-Saharan Africa, but was less an issue
in Asia. Respondents in the USA and EU cited other jobs or business
opportunities as reasons for business discontinuance.
Necessity and Opportunity Driven Entrepreneurs
•In factor-driven economies, the proportion of entrepreneurs with
necessity-driven motives generally declines, while improvement-driven
opportunities (to improve income or independence) increase.
•Geography also plays a part. Latin America/Caribbean and non-EU
economies are both efficiency-driven, but the Latin America/Caribbean
region reported twice as many entrepreneurs with improvement-driven
opportunity motives than those with necessity motives.
In contrast, non-EU countries show equal levels of either motive.
•Entrepreneurship activity among men and women was almost equal in most
sub-Saharan Africa economies, while men were 2.8 times as likely to
start a business than women in the MENA region.
•In Egypt, Palestine, and Korea, less than one-fifth of all
entrepreneurs were women. Only 5 percent of entrepreneurs in Pakistan
•Ecuador and Panama, Ghana and Nigeria, and Thailand were the only
economies where the female TEA rate was higher than that for males.
•Despite low TEA rates among non-EU countries, nearly a fifth of their
entrepreneurs expect to hire 20 or more employees in the next five
•The USA reported a high proportion of entrepreneurs projecting 20 or
more new hires and also boasts a high TEA rate among innovation-driven
•Singapore, China, and Colombia also displayed both high TEA rates and
high proportions of 20 plus growth entrepreneurs compared to others in
Entrepreneurship Framework Conditions
GEM interviewed country experts about the kinds of Entrepreneurship
Framework Conditions (EFCs) – from education and national policy to
internal markets and infrastructure systems – that will contribute to a
healthy environment for entrepreneurship.
•Overall, physical infrastructure was identified as a positive factor in
nearly every economy and region. Internal market dynamics (the level of
change in markets) was viewed as positive by most of sub-Saharan
Africa, MENA, Asia Pacific/South Asia, and non-EU
economies. A more negative outlook on market dynamics was found in
Latin America/Caribbean, the EU, and the USA.
•Most GEM economies see a need for improved entrepreneurship education
at the primary and secondary levels. Entrepreneurial finance was another
condition frequently cited as negative, but particularly in the Latin
•Experts in the USA saw cultural and social norms as positive, while
only one EU economy identified this condition favorably. The USA also
rated R&D transfer positively, while sub-Saharan Africa and many
economies saw this condition as negative.
Entrepreneurship and Migration
In 2012, GEM included questions around the special topic of
international migration. Currently there are more than 210 million
international migrants with increases expected in the next ten years.
Migrant entrepreneurs have the potential to contribute substantially
to their societies through knowledge and information transfer, global
trade, and job creation.
•Migrants exhibit a higher rate of entrepreneurship than non-migrants
in innovation and factor-driven economies. Efficiency-driven economies
showed an opposite pattern with lower TEA rates among migrant
•25 percent of migrant entrepreneurs (non-migrants 16 percent) in
efficiency-driven economies expect to create 10 or more jobs; 23 percent
(non-migrants 9 percent) in factor-driven economies; and 20 percent
(non-migrants 14 percent) in innovation-driven economies.
•More than half of migrant entrepreneurs said they sell products and
services outside their host economy. This pattern was similar in
innovation-driven economies but less so in factor-driven economies.
GEM researchers offer several guidelines for policy makers,
entrepreneurs, and academics to help them build entrepreneurial
eco-systems that enable entrepreneurship to flourish in every world
•Develop policies to promote societal attitude changes about women; and that train, support and encourage women entrepreneurs.
•Create special entrepreneurial support tools and programs for entrepreneurs of different ages.
•Re-engage former entrepreneurs and leverage their wealth of experience in mentoring new entrepreneurs.
•Implement policies to encourage youth entrepreneurship, especially in high un-employment regions such as sub-Saharan Africa.
•Encourage national and global efforts to improve entrepreneurship education in primary and secondary schools.
•Help economies to recognize the value migrants provide in creating jobs and globalizing the business environment.
•Urge governments to enforce a strong rule of law to maintain the
quality of entrepreneurial entries. GEM also stresses the importance of
developing legal frameworks in which entrepreneurship can thrive.
"Entrepreneurship creates employment and adds economic value for
economies everywhere. But this activity must be enacted in tandem with
inclusiveness for all sections of society, because it is an effective
way to encourage prosperity and peace,” said the report’s
lead author Siri Roland Xavier.
Download the report (http://www.babson.edu/academics/centers/blank-center/global-research/gem/pages/home.aspx )
GEM 2012 Global Report Sponsors
GEM 2012 Global Report sponsors are Babson College, Universidad Del
Desarrollo, University Tun Abdul Razak, GERA and GEM. The Global
Entrepreneurship Research Association (GERA) is, for constitutional and
regulatory purposes, the umbrella organization that
hosts the GEM project. GERA is an association formed of Babson College,
London Business School and representatives of the Association of GEM
Global Entrepreneurship Monitor (GEM) is a not-for-profit academic
research consortium that has as its goal making high quality information
on global entrepreneurship
activity readily available to as wide an audience as possible. GEM is
the largest single study of entrepreneurial activity in the world.
Initiated in 1999 with just 10 countries, GEM has now conducted research
in over 80 economies all over the world. Visithttp://www.babson.edu/academics/centers/blank-center/global-research/gem/pages/home.aspx
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