I thought I would share some more research results from this year's Global Entrepreneurship Monitor (GEM) report for Wales study.
Globally, GEM study covers 42 countries, interviews over 156,000 adults annually and represents the world’s most authoritative comparative study of entrepreneurial activity. It does this through examining individuals and their role in starting a new firm, whether they own or manage a business, what motivates them, where their finance comes from, and what their attitudes are towards entrepreneurship.
Since 2000, when I was awarded the research contract to undertake this work by the Welsh Development Agency, I am proud to say that the study has come a long way. Now financed through a combination of support from Cardiff and Glamorgan Universities, European Structural Funds and Assembly funding, the project has developed into one in which detailed evidence cane be produced to influence policy.
This year’s report is the most comprehensive ever, and is testament to the achievements of the research team that has been built around the project and, in particular, the hard work and detailed analysis that has taken place during the last three months.
Prior to this year’s publication, there was a conscious decision to move away from focusing on just reporting entrepreneurial activity levels in Wales, as the report had done so in the last two years. Instead, the study focused on looking at entrepreneurial activity from a range of different angles, including family businesses, provision of informal investment, enterprise within deprived areas and the characteristics of home-based businesses.
As many are aware, basing a business in the home may be the first tentative step by many potential entrepreneurs into enterprise, and is normally influenced by factors such as the low availability of start-up capital and access to premises. Despite this, the importance of home-based businesses should not be underestimated as many successful entrepreneurs, from Steve Jobs at Apple to Richard Branson at Virgin, have started their business from their bedrooms or garages before creating successful multi-million pound businesses.
Home-based entrepreneurship may also be influenced by changes in the way we work. Increased globalisation and the lower economies of scale afforded by laptop computers, mobile phones and the internet, has led to greater spatial mobility of both the employed and the self-employed, thus releasing them from constraints of having to work at fixed locations.
In particular, the growth in service industries have made working from home a more accepted practice among non-manual workers, especially in areas such as consultancy, professional support, and other business-related services.
The potential of working for one-self whilst raising a family has also been made more attractive through a greater acceptance of flexible working. As a result, many women may choose home-working because of the convenience it affords them while having to balance work and family.
On the other hand, enterprise as a career choice may not be available to some groups who are driven into becoming self-employed out of necessity because of poor alternative prospects for employment and are simply waiting for alternative employment opportunities to develop.
So what do we know about home-based businesses in Wales? According to the GEM 2007 study, nearly two thirds of all entrepreneurs in Wales are home-based, which is a higher proportion than for the UK as a whole. However, a greater proportion of male entrepreneurs are based at their home address, which reflects the general trend that only a third of the entrepreneurs in Wales are women.
The study also shows that with respect to the age profile of home-based entrepreneurs, the older the entrepreneur, the more likely the business is to be based at home. It is also worth noting that, in Wales (but not in the UK), a high proportion of those with no formal qualifications and a lower than average household income are based in the home, and that the level of qualification and income is linked to the probability of the business being home-based.
In addition, over 70 per cent of necessity entrepreneurs – those who start a business because they have no other work options – are also based out of the home.
Therefore, the GEM Wales study shows that whilst the majority of entrepreneurs are working from their own homes, the reasons for doing so tend to be linked to issues such as age, lack of finance, necessity and lack of education, rather than a desire for greater flexibility, building knowledge-based professional businesses and balancing home-work commitments.
Certainly, these basic results have, in themselves, quite profound implications for the development of enterprise activities and the ways in which it can be supported.
I can only hope that policymakers will now use the comprehensive evidence from the GEM research, as they have done so in England and Scotland, to inform new initiatives that can make a real difference in promoting further entrepreneurship across Wales.
Globally, GEM study covers 42 countries, interviews over 156,000 adults annually and represents the world’s most authoritative comparative study of entrepreneurial activity. It does this through examining individuals and their role in starting a new firm, whether they own or manage a business, what motivates them, where their finance comes from, and what their attitudes are towards entrepreneurship.
Since 2000, when I was awarded the research contract to undertake this work by the Welsh Development Agency, I am proud to say that the study has come a long way. Now financed through a combination of support from Cardiff and Glamorgan Universities, European Structural Funds and Assembly funding, the project has developed into one in which detailed evidence cane be produced to influence policy.
This year’s report is the most comprehensive ever, and is testament to the achievements of the research team that has been built around the project and, in particular, the hard work and detailed analysis that has taken place during the last three months.
Prior to this year’s publication, there was a conscious decision to move away from focusing on just reporting entrepreneurial activity levels in Wales, as the report had done so in the last two years. Instead, the study focused on looking at entrepreneurial activity from a range of different angles, including family businesses, provision of informal investment, enterprise within deprived areas and the characteristics of home-based businesses.
As many are aware, basing a business in the home may be the first tentative step by many potential entrepreneurs into enterprise, and is normally influenced by factors such as the low availability of start-up capital and access to premises. Despite this, the importance of home-based businesses should not be underestimated as many successful entrepreneurs, from Steve Jobs at Apple to Richard Branson at Virgin, have started their business from their bedrooms or garages before creating successful multi-million pound businesses.
Home-based entrepreneurship may also be influenced by changes in the way we work. Increased globalisation and the lower economies of scale afforded by laptop computers, mobile phones and the internet, has led to greater spatial mobility of both the employed and the self-employed, thus releasing them from constraints of having to work at fixed locations.
In particular, the growth in service industries have made working from home a more accepted practice among non-manual workers, especially in areas such as consultancy, professional support, and other business-related services.
The potential of working for one-self whilst raising a family has also been made more attractive through a greater acceptance of flexible working. As a result, many women may choose home-working because of the convenience it affords them while having to balance work and family.
On the other hand, enterprise as a career choice may not be available to some groups who are driven into becoming self-employed out of necessity because of poor alternative prospects for employment and are simply waiting for alternative employment opportunities to develop.
So what do we know about home-based businesses in Wales? According to the GEM 2007 study, nearly two thirds of all entrepreneurs in Wales are home-based, which is a higher proportion than for the UK as a whole. However, a greater proportion of male entrepreneurs are based at their home address, which reflects the general trend that only a third of the entrepreneurs in Wales are women.
The study also shows that with respect to the age profile of home-based entrepreneurs, the older the entrepreneur, the more likely the business is to be based at home. It is also worth noting that, in Wales (but not in the UK), a high proportion of those with no formal qualifications and a lower than average household income are based in the home, and that the level of qualification and income is linked to the probability of the business being home-based.
In addition, over 70 per cent of necessity entrepreneurs – those who start a business because they have no other work options – are also based out of the home.
Therefore, the GEM Wales study shows that whilst the majority of entrepreneurs are working from their own homes, the reasons for doing so tend to be linked to issues such as age, lack of finance, necessity and lack of education, rather than a desire for greater flexibility, building knowledge-based professional businesses and balancing home-work commitments.
Certainly, these basic results have, in themselves, quite profound implications for the development of enterprise activities and the ways in which it can be supported.
I can only hope that policymakers will now use the comprehensive evidence from the GEM research, as they have done so in England and Scotland, to inform new initiatives that can make a real difference in promoting further entrepreneurship across Wales.
Comments
Nice posting...
I need some information on Home based business. Waiting for your next post...