The Global Entrepreneurship Monitor (GEM) 2016 results have been announced

The Global Entrepreneurship Monitor (GEM), which is considered the most comprehensive entrepreneurship project, has announced its 2016 results. This project is run by the contributions of the Small and Medium Enterprises Development Organization (KOSGEB), TEB (Türk Ekonomi Bankası) and the academic support of Yeditepe University.

The 2016/17 Global Entrepreneurship Monitor (GEM) reports that global entrepreneurship is on the rise and the key for job creation is the creation of a positive global entrepreneurship ecosystem.

According to the Global Entrepreneurship Monitor (GEM) 2016/17 Global Report released today by Babson College, Universidad Del Desarrollo, and Universiti Tun Abdul Razak, fifty-five percent of entrepreneurs worldwide expect to create at least one job in the next five years. In general, the expectation for growth among entrepreneurs is low. However, the ratio of early stage entrepreneurs who have the potential to grow is high in Turkey and Turkey is second on the list among the 62 countries which were included in the study.

Globally, there are many factors in play that could hinder such entrepreneurial growth. These include sophisticated technologies and communications that may enable entrepreneurs to operate on their own, rigid labor regulations, poor availability of skilled or educated labor, limited access to entrepreneurial finance, and the decision to stay small to avoid the complexities of formalization.

“The power of entrepreneurship to create jobs demonstrates its crucial importance to economic growth and stability around the world,” said Professor Donna Kelley. “Whether this means alleviating regulatory burdens or offering specialized financial support, policy makers and private stakeholders will need to direct their attention toward policies and practices that can together strengthen the ecosystem that supports the efforts and ambitions of entrepreneurs.”

GEM countries in the 2016 survey cover 69.2 percent of the world’s population and 84.9 percent of the world’s GDP. It continues to be the biggest entrepreneurship study in the world for 18 years.

 

Key Findings of the 2016/17 Global Report

Over the past year, entrepreneurial activity remained stable or increased in approximately two-thirds of all economies surveyed in both 2015 and 2016. Average total early-stage Entrepreneurial Activity (between the ages of 18 and 64 years) rates tend to be highest in the factor-driven economies, decreasing with higher levels of economic development. This rate is 17 percent in factor-driven economies, 14 percent in efficiency-driven economies and 9 percent in innovation-driven economies.

While the rate of Early Stage Entrepreneurship in Turkey in 2015 was 17,4 percent, it dropped to 16,1 percent in 2016. However, this rate (16,1%) is still higher than the average rate of efficiency-driven economies (14%).

According to the GEM study, the drop in entrepreneurship rates is caused by male entrepreneurs. While there was a decrease in male early stage entrepreneurship activities in 2016, there was an increase in female entrepreneur rates. It can be said that there is a continuity in female entrepreneurship activities in Turkey.

Regionally, TEA rates are highest in Latin America and the Caribbean and in Africa. In both regions, roughly one-fifth of adults are engaged in early-stage entrepreneurial activity. Regionally Turkey has a higher entrepreneurship rate than China (10,3%), India (10,6%) and Israel (11,3%). Europe reports the lowest regional TEA rates, with three of the four lowest rates in this region. Italy, Germany, Malaysia, and Bulgaria all fall below 5 percent.

An innovative economy is also related to economic development rates. Regionally, innovation intensity is highest in North America at 39 percent and lowest in Africa at 20 percent. However, in Turkey the rate of entrepreneurs who are introducing innovative products or services is 30,1 percent.

The report states that there is a strong relationship between entrepreneurship rates and how people perceive entrepreneurship. See entrepreneurship as a good career choice, entrepreneurs receiving frequent positive media attention are factors affecting people to become entrepreneurs.

Sixty percent believe entrepreneurs receive positive media attention. Among the highest levels reported are China, Thailand, and Indonesia, where more than three-fourths of adults see positive media attention for entrepreneurs, Greece, India, and Mexico report around half this level. While the rate of adults seeing entrepreneurship as a good career choice is 45 percent, the rate in Turkey is 81 percent. It is 65th among the countries that took part in the GEM study. In addition, in Mexico and India 47 percent of the adults believe that entrepreneurs are well-regarded and enjoy high status, whereas this rate is 72 percent in Turkey.

According to GEM Executive Director Mike Herrington, The GEM Global Report aims to provide academics, educators, policy makers, and practitioners with key insights into the interdependency between entrepreneurship and economic development, by

 

  • Uncovering factors that encourage or hinder entrepreneurial activity, especially related to societal values, personal attributes, and the entrepreneurship ecosystem;
  • Providing a platform for assessing the extent to which entrepreneurial activity influences economic growth within individual economies; and
  • Uncovering policy implications for the purpose of enhancing entrepreneurial capacity in an economy.

 

Herrington points out that there is no one-size-fits-all solution for promoting entrepreneurship across the globe. However, the report offers some suggestions that could serve as a basis for discussion about policies and practices that might support entrepreneurs and promote greater impact on their societies. GEM has conducted a research about policies in entrepreneurship in 37 economies.

The reports can be accessed at the links below:

 

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