GROWING OUR ECONOMY THROUGH YOUNG ENTREPRENEURS:

Proposals to Remove Barriers to Young People Starting Businesses

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Download PDF of full issue brief here.

Young people want to start businesses. According to the Kauffman survey, 39 percent of
teenagers show interest in starting a business, and that number goes up as people enter their 20s. But entrepreneurialism has declined for young people in the past five years; fewer young people are getting the chance to pursue their American dream.

This is both bad for young people and bad for the country. Millenials can, and should, be
drivers of economic growth. Young adults are risk-takers, and are committed to their ideas – two important characteristics of successful entrepreneurs. They understand new technology, and have innovative ideas. If we act now, the Recession could be an opportunity to turn what has the potential of becoming the Lost Generation into a generation that fuels tomorrow's new economy: the Entrepreneurial Generation.

The prospect of a young, start-up driven sector leading the charge as the economy starts to pick up is not just rhetoric. Start-ups tend to retain about 80% of the jobs created, five years out. In the long run, enterprises started as our economy moves out of the Recession will create similar numbers of jobs as non-Recession start-ups, providing a substantial amount of long-term jobs for Millenials. As such, we call for federal action to:

»» Implement a federal student loan forgiveness program for young entrepreneurs;

»» Double the capital available through the SBA Microloan program, target outreach to
young people, and ensure that intermediaries are not putting up barriers to accessing
these dollars due to lack of credit or collateral;

»» Target federal government procurement at young small businesses;

»» Encourage entrepreneurship through agency-sponsored student competitions, modeled after HHS initiatives; and

»» Expand, and more directly target, federal incentives for education in entrepreneurship at both secondary and post-secondary levels.

The private sector must also contribute by:

»» Targeting public-private partnerships such as Startup America to youth; and

»» Increasing the focus on entrepreneurial mentorship from the private sector.