The article argues that the role of entrepreneurship is the establishment of tiny, micro, and small-scale enterprises. Such enterprises create employment opportunities, particularly for the youth. Precisely, it gives rise to independence through self-employment and wage–employment. Entrepreneurship up-lift the economically backward sections of the society. Also, entrepreneurship utilizes a surplus labor force in industrial activities. The introduction of innovation and entrepreneurship into the education system by making the universities the important stakeholder would bring down the unemployment and, in turn promoting entrepreneurship to the youth to find and create their employment and work towards its eradication.
Association between unemployment in the business cycle and entrepreneurship
The study collected relevant data from 1993 to 2009 and deployed seven variables; self-employment rate and proper entrepreneurship were treated as dependent variables. The independent variables were the rate of newly registered unemployed, long-term employment, sign-off unemployed and average wages, and the reference cycle. Data analysis was based on regression analysis techniques. The results of the study argued that entrepreneurial activities and the unemployment ratio are closely related. Poor labor market conditions increase unemployment,
while improved working conditions and wage rates negatively influence entrepreneurship. Cyclical changes in wages and unemployment influence levels of entrepreneurship, as these factors prove as negative motivation for entrepreneurship. The capacity of entrepreneurship influences the ratio of employment optimistically.
To detect the association between unemployment and entrepreneurship in the context of the US, data from 1972 to 2002 were collected. It includes two variables, the business ownership rate has been taken as an independent variable, and unemployment has been taken as a dependent variable. The result was based on regression analysis techniques. The study concluded that the US is a relative outlier regarding the relationship between unemployment and entrepreneurship.
The impact of entrepreneurs on economic growth and job creation
The analysis was based on the content technique. Entrepreneurship is an important factor in the development of economies. However, it also concluded that entrepreneurs are rare, even in developed and innovation-driven economies. In societies where entrepreneurs have flexibility in operating, reaping, rewarding, and developing ideas, the economies grow more rapidly. The export trade is also growing in the US due to entrepreneurial activities. Entrepreneurial activities have a positive impact on the reduction of the unemployment rate. Higher exports have a positive impact on GDP and reduce inflation.
Many management scientists studied the relationship between the unemployment rate and entrepreneurship in an economy. Economic data from 10 years (2003 – 2013) was analyzed. Regression analysis was applied to the data. It established a significant impact of entrepreneurship on the rate of unemployment. The outcome rejected the null hypothesis. Entrepreneurial developments influenced the unemployment rate in the US. The research used a content analysis technique to extract the results from the available data. It was noted that some entrepreneurial developmental policies were designed in the US. To enhance the capacity of entrepreneurial activities, entrepreneurs were encouraged to become export agents. The study concluded that entrepreneurial developments are instrumental to the country’s economic growth and played an immense role in balancing job creation and development. The paper sheds light on the job market situation of the country and the role of entrepreneurship in generating employment opportunities. The results concluded that entrepreneurship is among the major contributors to economic growth and, therefore, unemployment reduction.
Entrepreneurship contributes to the creation of employment opportunities for the youth where they source an intrinsic outcome. Employment, in turn, stimulate spending in a country; thus, improving the country’s economy. For, the level of spending among young people with families increases dramatically when they have appropriate employment. Currency circularization increases, making the economy more dynamic. This also facilitates the strength of families among young people. Although it is a condition where young people attain employment opportunities through entrepreneurship, the US market is saturated. Differently, some of the young people become entrepreneurs; thus, employing others.
The US is a multi-resource economy with strong government controls over major economic activities. The US also encourages the growth of the private sector to diversify its economy and employ its citizens as opposed to immigrants. The current economic condition in the country is not very favorable due to the decline in oil prices in the international market. However, the government is spending a huge amount on job training and education. It is observed that the US stands 54th rank overall. Also, it is stated that it is ranked 126th in innovation efficiency or its success in transforming the innovation enablers into innovation output, which was incredibly low.
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