Entrepreneurial Population Dynamics
Jonathan Ortmans, President, Public Forum Institute
An aging country doesn’t strike one as an entrepreneurial society, but Dane Stangler from the Kauffman Foundation put together various pieces of evidence suggesting that we are “on the cusp of an entrepreneurship boom.” In a new report, "The Coming Entrepreneurship Boom," Dane explains that the U.S. is likely to experience an entrepreneurship boom because the largest age group of our population, the baby boomers, is also the most entrepreneurial.
Several factors are driving this expectation, including the continued drop in the incidence of "lifetime" employment, the experience and tacit knowledge such employees take with them, longer life expectancies, and the regulatory changes and other effects of the current recession on established sectors of the economy.
According to the study, over the past decade, the highest rate of entrepreneurial activity belongs to Americans between the ages of 55 and 64, while the 20-34 age bracket had the lowest rate. Surprisingly, this disparity occurred in the 11 years around the dot-com boom, when the young risk-takers became a cultural icon. Previous research from Duke University's Vivek Wadhwa also shows that, contrary to popularly held assumptions, the average age of U.S.-born technology founders at the time of start-up was 39, and that twice as many of these entrepreneurs were older than fifty as were younger than twenty-five.
With entrepreneurship being a key economic engine, these trends anticipate promising outcomes for America’s economic recovery and growth potential.