After decades of declining entrepreneurship, record numbers of Americans have started their own businesses and gone to work for themselves. Thanks to the Great Resignation and a booming economy, 360 out of 100,000 American adults have become new entrepreneurs each month on average in 2021.
Recent immigrants, black and Hispanic Americans, and young workers are at the forefront of starting new businesses in this country. More than a third of America’s workforce is self-employed, and startups have spread far beyond Silicon Valley and major coastal cities.
Rather than positioning entrepreneurship as a privileged endeavor open only to those with wealth and connections, it should become a viable career path for Americans of all ages, backgrounds, and degree aspirations through to high quality education and training programs that are accessible, inclusive and equitable. Entrepreneurship is essential to economic progress, and more Americans need to develop this skill set and mindset to help them survive in turbulent economic times.
Startups and new businesses drive job growth, support a more resilient economy, and help uplift entire communities. Whether it’s personal and professional liberation, a desire to increase earning potential, or to follow a passion, entrepreneurship can be a rewarding path to a more successful life. Entrepreneurship should not be limited by race, ethnicity or gender. To protect recent gains in entrepreneurship from a potential recession, we need more and better ways to spark genius and opportunity in all communities.
Our nation has historically done a poor job of providing access to entrepreneurship. Either we’ve erected barriers that have reinforced the legacy of systemic racism, or we’ve failed to help people get the skills they need, or we’ve denied entrepreneurs of color funding. Venture capital from black-owned businesses, for example, soared in 2021 but fell just as rapidly this year.
To ensure that entrepreneurship is truly an option for all Americans, we need a broad strategy that spans multiple sectors in this country.
This effort must begin at home and in communities. Parents and adults should expose children early on to the idea that owning your own business is just a regular job. People model their behavior on what they see around them. If children can see entrepreneurs in their lives, they are more likely to see business ownership as a normal and accessible option for themselves.
The education systems of the nation should play a huge role. K-12 schools must teach students that not all successful paths require a four-year degree. Instead, they should encourage other career avenues such as entrepreneurship and integrate entrepreneurial training into vocational and technical training curricula. Colleges and universities must continue to increase their entrepreneurship offerings to meet growing student demand, especially among Black and Latino students.
At all levels of education, there must be programs that provide basic skills development in sales and marketing, finance and accounting, and leadership so that potential entrepreneurs learn to manage people, plan, and budget for business. future, navigate difficult economic situations and grow their businesses. . Additionally, these programs should support those looking to start businesses in the fast-growing trades, service industries, or creative economy.
Nonprofits can create or fund business incubators that can support innovators from underrepresented backgrounds as they translate their ideas into sustainable businesses. Venture capital and other financial vehicles need to be made more widely available so that promising new businesses can be created, grown and scaled. It is essential to target these programs specifically to black entrepreneurs, who launch their businesses with much less start-up capital than white entrepreneurs.
The United States Small Business Administration, through its Office of Entrepreneurship Education, can play a critical role in helping small businesses succeed and expanding opportunities for inclusion. Congress should act quickly to expand another SBA initiative, the Boots to Business program that provides entrepreneurship training to military dischargers and their spouses, and fund similar initiatives to target other underserved populations.
The US Department of Labor may consider developing new programs to support entrepreneurs and reinvigorate past efforts like Project GATE. This program has added a pathway to self-employment to the services offered by its one-stop career centers, which have historically supported those seeking entry-level opportunities that can lead to stable lifelong employment. Although the GATE project existed only briefly in the early 2000s, it reported small but significant increases in business ownership.
Existing models paired with new approaches that reach more of America can help entrepreneurship become a viable and sustainable career path for people of all backgrounds and a powerful driver of economic progress and wealth creation. for communities and individuals who have been historically excluded. . If we can develop the country’s entrepreneurial ecosystem equitably, we can develop the next generation of successful small business owners who can create more quality jobs and harness the power and promise of entrepreneurship.
Kristina Francis is Executive Director of JFFLabs.
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