The recession is hitting the economy hard, and a study is finding that it’s impacting attitudes on entrepreneurship quite differently across different generations.
According to a recent American Express OPEN® Ages Survey, Generation Y entrepreneurs are actually more risk adverse after experiencing their first-ever economic downturn (just 56% say they like taking risks, down from 72% in 2007), while those from the Baby Boomer generation’s appetite for risk have remained somewhat unchanged (54% vs. 53% in 2007).
And despite the efforts of various organizations to spur youth entrepreneurship in the country, the recession has worryingly impacted entrepreneurial attitudes as well – in 2007 about 28% of Generation Y actually launched new businesses straight out of school, but that has fallen to just 16% this year. Serial entrepreneurship has also fallen from 59% in 2007 to 44% today.
But there have been upsides as well. 80% of entrepreneurs from both generations attribute managing their businesses through the recession as the reason they became better entrepreneurs, becoming more creative in their marketing efforts as well as managing their finances. In fact, Gen Y-owned small businesses report having experienced 24% revenue growth during the recession.
Growth Vs Lifestyle
Interestingly, the survey has also thrown up interesting facts about generational attitudes towards entrepreneurship. While Gen Y are more go-getting, less than half of Baby Boomer entrepreneurs (47% vs. 66% of Gen Y) say growth is the top priority for their businesses. In fact, Baby Boomers look more towards work-life balance, preferring to work less per day (9 hours per day vs. 10 in 2007), and even making fun a priority in their businesses (73% up from 66% in 2007).
“Resilience is a trait shared by both generations of entrepreneurs,” says Susan Sobbott, president of American Express OPEN. “Younger business owners channeled their passion through innovative thinking and thrived in the face of adversity while older entrepreneurs relied on experience to weather the storm and find a better life balance.”