26, September, 2017 – Blog #11
Entrepreneurship in Alberta
Entrepreneurship is alive and well in Alberta, according to the latest GEM (Global Entrepreneurship Monitor) report, just issued by THECIS. Over 17% of the adult population is engaged in early stage entrepreneurship, a higher rate than in the US, Australia and all other advanced countries. Women are very active in early stage entrepreneurship, at 80% of the men’s rate, also higher than the US.
Consumer services is the most popular field, with just more than 50% of ventures, followed by business oriented services at 30% and manufacturing at 20%. Age is an important determinant of entrepreneurial activity, with higher rates in the 18-24 and 25-34 age groups. Overall, however, about half of new ventures are led by people aged 18-34, and half by those aged 35-64. Above age 65 the rate drops off, but still 4% of older Albertans are active as entrepreneurs.
Education is also a key determinant of entrepreneurship. As people acquire more education they become more entrepreneurial. The highest rate of entrepreneurship is found among those with post graduate education.
The Alberta population is very supportive of entrepreneurship, with 60%–70% of respondents believe that entrepreneurship is a good career choice that successful entrepreneurs have high social status, and that media provide favorable coverage of entrepreneurship.
About 15% of startups are highly innovative, having no direct competitors. About 40% of startups are in sectors with many competitors.
Experts were asked to evaluate the Alberta ecosystem by rating nine relevant factors. The five with the best scores were: physical infrastructure, commercial infrastructure, social and cultural norms, government programs, and government policy at neutral. The lower five in decreasing order were post-secondary education at neutral, R&D transfer (to small and growing firms), internal market dynamics, finance, and primary and secondary education. The experts were also asked to rate to biggest constraints and fostering factors. The most mentioned constraints were finance as the top priority with capacity for entrepreneurship and government policy as next areas of priority.
The most mentioned fostering factors were cultural and social norms as highest priority with the economic climate and, surprisingly, the low rated question of education and training as second and third areas of priority.
The report had five recommendations:
- Creative government programs are needed to support entrepreneurship that has promise to create new directions. This needs to involve all departments of governments, not only those with responsibility for small business.
- School systems need to examine the opportunities to promote entrepreneurial thinking in the context of education aimed at encouraging independence and creativity.
- Despite the evidence that entrepreneurship by women in Alberta is stronger than in other parts of the country or in other developed countries, a gap remains and attitude and motivation data indicate that women still have less confidence in skills and knowledge and women entrepreneurs have more complex motivations. Information programs and mentorship for women remain a priority.
- With the low rate of seniors’ entrepreneurship and the expected increase in size of this demographic in better health in the future, consider targeting entrepreneurship programs at older Albertans.
- Data show rates of entrepreneurship rise with increase of educational experience. Education for entrepreneurial thinking should be promoted across all types of secondary and post-secondary programs.
The full report is available at www.gemcanada.org