Entrepreneurs are often depicted as young innovators who have found a way to disrupt long-standing industries. While there are certainly many examples of youthful entrepreneurship, this characterization overlooks the contributions of older entrepreneurs – and a new report from the Global Entrepreneurship Monitor (GEM) suggests those contributions might be far more significant than previously recognized.
The GEM report reveals global trends in entrepreneurship from 2009 through 2016, and identifies entrepreneurs over the age of 50 as especially important to economies where the population is aging. The report concludes that older entrepreneurs are still contributing into the system and become less likely to strain state resources or impact the labor market.
"Entrepreneurial success and prosperity has no age limits," Mike Herrington, executive director of GEM, said in a statement. "While the traditional perception of entrepreneurship is that it is a young person's endeavor, the data are showing us that, in many aspects, older people are a significant entrepreneurial force. But this segment is largely an overlooked and undervalued resource."
Drawing on data from more than 1.5 million entrepreneurs worldwide between the ages of 18 and 80, the GEM report found that people between ages 50 and 64, as well as the ages of 65 and 80 are more likely to be self-employed than their younger counterparts. Despite this, a stereotype persists that younger entrepreneurs require the lion's share of support. Thomas Schøtt, lead author of the report and professor of entrepreneurship at the University of Southern Denmark, said the reality is quite different.
"Every older adult who is self-employed is less likely to place a financial burden on society and to contribute to the economy of that country through the payment of taxes and by remaining economically active," Schøtt said. "Additionally, senior entrepreneurs are marginally more likely than their younger counterparts to employ more than five people, so they are not only creating jobs for themselves but for others as well."
He added that older entrepreneurs come with what he called "golden dividends" – factors such as reduced burden on state budgets, relieving pressure of an aging population, the creation of more jobs than their younger counterparts, and larger investments in other entrepreneurial endeavors. Older entrepreneurs also tend to report higher levels of work and life satisfaction when compared to workers of the same age, often reducing demand on health and public services.
In the U.S., the workforce is rapidly aging. According to the U.S. Bureau of Labor Statistics (BLS), the share of workers aged 55 and older has steadily grown since 1992. The BLS projects that by 2022, when the next tally will be taken, workers over age 55 will make up more than 25 percent of the entire workforce. That means older entrepreneurs will play a key role in buoying social services as government revenue sources decline in number and the number of those placing demands on those services increases.
"The world is beginning to understand how senior entrepreneurs with their wealth of work and life experience, deep networks, and eagerness to remain productive are a huge untapped resource," Schøtt said. "It is time that we stop thinking about this demographic as a liability and instead recognize them as assets, and work across sectors to help break down barriers to unleash their potential."