The looming retirements of Baby Boomers could launch a new generation of entrepreneurship, according to new research. Many baby boomers nearing retirement age will launch new businesses in far greater numbers than their counterparts from earlier generations, according to the first installment of the Intuit Future of Small Business Report.
Their motivation: diminished job security, disappearing pensions and health benefits, and the need to match savings with longer life expectancies – issues central to the focus of advisers focused on employer-sponsored retirement plans.
Clients, Not Employers
Moreover, the line between small and large businesses will blur as more entrepreneurs form free-agent contracts with large companies as a natural response to the demise of lifetime employment. According to the report, by 2017, free agents will thrive with less job security – “they will have clients, not employers,’ asserts the study. These “spin-offs’ will exert far more control over their time and working conditions.
This new surge in entrepreneurship will be fostered in the workplace of tomorrow. The study notes that, for some, entrepreneurship will complement a corporate career, but not replace it, as employers see the entrepreneurial spirit as key to innovation and will train promising candidates accordingly. The report says that, as a result, professionals will spend their careers “alternating between two related worlds, sometimes running their own businesses in the free market and at other times running a virtual business within a larger organization.’ Completing a new virtuous circle, experience in the former will help bolster the latter.
“Contract workers, accidental and social entrepreneurs will fuel a proliferation of personal businesses,” claims the report, while economic, social and technological change – and an increased interest in flexible work schedules – will produce a more independent workforce seeking a better work-life balance.
Following in Their Footsteps
Not only will these former participants strike out on their own, many of their children will follow suit, becoming the most entrepreneurial generation in American history, according to the report authors. Those in Generation Y are “remarkably well-suited to the emerging entrepreneurial environment,’ according to the report. Indeed, entrepreneurs will no longer come predominantly from the middle of the age spectrum, but instead from the “edges,’ with those nearing retirement and their children who are just entering the job market laying the foundation for “the most entrepreneurial generation ever.’
Additionally, women will increasingly turn to entrepreneurship. The glass ceiling that has limited women’s growth in traditional corporate career paths will send a rich talent pool to the small business sector, according to the study’s authors. “Mompreneurs’ – mothers who start part-time, home-based businesses, often with the help of the Internet, will be part of this trend. In fact, these “personal businesses,’ as the one-person sector is sometimes called, will be launched by people who may not even consider themselves small business owners. Moreover, a “new breed’ of immigrant entrepreneurs will turn to the Internet to launch business, using their language skills, strong educations, multi-country contacts and professional experience to form international partnerships.
Entrepreneurial training will begin much earlier in life, with universities, secondary and vocational schools – and even some elementary schools – offering entrepreneurship as a mainstream subject. At the college level, the emphasis will widen, focusing not just on high-growth businesses backed by venture capital, but on small business ownership of all kinds.
The report is available online HERE