The Global Level of Entrepreneurship in 2020.
Entrepreneurs, no different from people in general, come in all shapes and sizes. Some are simply buying things and reselling them, often online. Others are producing goods, from baking cakes in the kitchen to manufacturing advanced robotics. Yet others provide services, from walking dogs to completing others’ tax returns. One commonality is that they have all taken the decision to start a business or to take over a business from someone else. That decision tends to be influenced by a host of personal factors: the ability to spot opportunities; the attitude towards taking risks; individual ambitions, objectives and levels of self-confidence; as well as access to resources including social and family support. People starting businesses have to rely on the help of a range of other stakeholders: some formal relationships, such as those with suppliers and banks; others more informal, such as with family and friends.
GEM is unique in the increasingly populated world of entrepreneurship research. The consortium has been actively and consistently measuring and evaluating levels of entrepreneurial activity since 1999.The Global Entrepreneurship Monitor (GEM) is the world’s largest, and longest-running, study of entrepreneurs and entrepreneurial perceptions.
The GEM 2020/2021 Global Report provides a detailed profile of each of the 46 economies that participated in GEM’s 2020 research. The levels of entrepreneurial activity across the globe in 2020 has been compared to the levels in 2019 to show that a majority of economies had lower levels of adults running either a new or established business in 2020, including nine economies in which the percentage of adults running an established business had fallen by a quarter or more. However, falls are certainly not universal: a minority of economies have experienced increases in entrepreneurial activity, especially in Latin America & Caribbean and Middle East & Africa economies. The Middle East, in particular, is emerging as a hothouse of entrepreneurial activity. Egypt, for example, has seen both its level of early-stage entrepreneurial activity and its level of Established Business Ownership rise substantially.
On a similarly positive note, those starting or running a new business were asked if the pandemic had led to new opportunities they wanted to pursue. In nine economies, mostly from Latin America & Caribbean or Middle East &
Africa, over half agreed. There was less optimism about new business opportunities among established business owners, especially outside of the Latin America & Caribbean global region.
Finally, relatively few of those exiting a business in the past 12 months are prepared to cite the pandemic as the main reason. Despite expectations, in comparing exit rates in 2020 to 2019, across the 43 economies, an individual
economy chosen at random was just as likely to have experienced a decrease as an increase.
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By Issam Oueslati - Last updated on May 07, 2020