Unemployment is bad, and our progress in creating new jobs has been unacceptably slow.
Youth unemployment is often where the problem is worst, and it’s becoming a global phenomenon with 20 percent of British youth and 40 percent of Spanish youth unable to find jobs. The labor force in the developing world, not including China with its one-child per family policy, is projected to increase by 50 percent by 2050. In sub-Saharan Africa, it is expected to increase by 100 percent.
How can we create work for all these young people?
The answer is entrepreneurs.
“High-growth start-ups are the best generators of new jobs (the Kauffman Foundation, an American outfit devoted to entrepreneurship, calculates that between 1980 and 2005 nearly all net job creation in America took place in firms that were less than five years old). They are also the firms most likely to raise productivity, a basis for economic growth. They create jobs that did not previously exist and solve problems that people assumed were part of the natural order of things.” (The Economist, February 24, 2011)
The Economist reports on a new index for measuring entrepreneurship. Named the Global Entrepreneurship and Development Index, it measures the ambition of entrepreneurs as well as the prevalence of start-ups. Interestingly, it found that Britain, Germany and France all perform below their potential because of a shortage of venture capital.
“On the list of all countries great and small, Denmark comes top and America sliped to third place. Four of the five Nordic countries are in the top ten. This suggests that it is possible to combine crackling enterprise with a big welfare state.”
Why, when we need new jobs more than ever, is America becoming a less hospitable place to entrepreneurs?
Look no further than the US Chamber of Commerce. It is doing a better job supporting its largest and wealthiest members, those who ship jobs out of the country to bolster their bottom line, while abandoning the interests of its smaller constituents.
The US Chamber of Commerce claims to represent 3 million business, but, in actuality, it represents a fraction of those businesses – 200,000 to be exact, with 16 footing the bill on most of the Chamber’s funding.
It’s time for a new organization that speaks for all business and supports our entrepreneurs. Two organizations are doing so – the American Sustainable Business Council (of which I’m a co-founder) and The US Chamber Doesn’t Speak For Me, a joint effort. That’s the key to ending youth unemployment.
Bill Ryerson, founder of Population Media Center, a non-profit committed to addressing the population issue, and improving the lives of women worldwide, via reproductive education and promotion of small families, writes that, “when it comes to controversial issues, population is in a class by itself.” I know. It’s risky business to raise the issue, but how can one not in the context of a piece on job shortages – now and in the future? The obvious thing that pops into my head IS the population issue – there is too much demand. With the population expected to reach nine billion by 2050 – can there ever be enough jobs – probably not. Actually, can there ever be enough of anything – probably not. I suspect that not even entreprenuers can get us out of this one. It is critical for this planet that population education take center stage; that governments step-up and address the issue. Really, what problem existing today would not be improved with less people to provide for? Granted, the need for jobs is immediate but, if the population issue is not addressed now, we will be here again one day – maybe sooner rather than later.
If you think back to your own experiences growing up, most of us worked part-time in a local retail or service job while in high school. Today, many of those jobs are held by seniors unable to retire without a supplementary income or college-age young adults. As a result, youth in any community – poor and middle class – never get to have working for a paycheck as part of their growing up experience. We have at least two whole generations now that were largely cut out of the part-time job market while growing up. Small community businesses – not mega-retailers in remote locations – are the primary source of employment for urban youth and they have been failing at an unprecedented rate – largely due to restructuring of retail. Communities can address this issue by working to support the development of local retailing centers, commercial strips and small businesses that provide services that compete with the large box retailers. Local development organizations need to understand this and focus on this as both a business and human development strategy.
Mega businesses suck the life from a community. When you drive across America, what do you see? The same thing at every community. Big mega business lined along the freeways. The wages at these locations are not enough to support a family, so we as a people are supplementing the mega business through food stamps, medical, and housing. Something we complain about all the time, but there is no requirement that these mega stores provide either a decent wage or to pay a tax to support what we as a people have to provide to their workers. Plus, if these mega stores were to pay a decent wage, maybe one parent could stay home to take care of the family, thus increasing the number of part time jobs that would be available to the youth. Then, does the money spent at this locations stay in the community – No, it does not. Normally, every dollar spent intially in a community store will circulate 7 times within that community. Small Mom and Pop stores are the economic base of a community, the money stays in the community and is circulated within that community. Funds spent at the mega stores leave the community. There is no circulation of that profit staying within the community. As the mega stores take over our country, we are creating communities that are not unique, do not keep the money spent circulating within that community so that there is a solid economic base, and then that community has to pay for the opportunity of having those stores in their community by providng food stamps, medical, and sometime housing to their employees. Then, both parents have to work thus reducing the number of jobs available for youth, increasing the stress for the families where both parents work, and reducing the amount of time families can be together. Again, mega businesses are sucking the life from a community, its people, and the uniqueness of a community.