The aim of this High-Level Capacity Building Seminar is have an international exchange of information on inclusive entrepreneurship actions across the European Union and on how the European Union Structural Funds can be used to support actions that combine entrepreneurship promotion and social inclusion.

1. POLICY ACTIONS FOR YOUTH
ENTREPRENEURSHIP
Importance and challenges
Dr. Jonathan Potter
Senior Economist, Centre for Entrepreneurship, SMEs and Local
Development, OECD
Jonathan.Potter@oecd.org

2. Table of contents
1. Youth unemployment and potential of entrepreneurship
2. Barriers encountered by young entrepreneurs
3. The opportunities to develop policy actions using
European Funds
4. Evidence that youth entrepreneurship actions can work
5. Keys to delivering support
6. Conclusions

3. Unemployment rates in the EU
0
5
10
15
20
25
30
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
%
Total Males Females
Adults
(15 to 64
years old)
Youth
(15 to 24
years old)
• Unemployment rates for youth are approximately double the rate for adults.
• Gender differences are small: converging for adults but diverging for youth.
Source: Eurostat LFS

4. Unemployment rates in Member States, 2013
0
10
20
30
40
50
60
70%
Adults (15 to 64 years old) Youth (15 to 24 years old)
• Youth unemployment rates are double the rate for adults in most Member
States.
Source: Eurostat LFS

5. Perceptions and feasibility of self-
employment in the EU, 2012
• 45% of youth have a preference for self-employment and 41% believe that it
is feasible to be self-employed in the next 5 years.
Source: Flash Eurobarometer #354 (2012)
0
10
20
30
40
50
60
Total Youth
%
Preference for self-employment Feasibility of self-employment in next 5 years

6. Self-employment rates in the EU
0
5
10
15
20
25
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
%
Total Males Females
Adults
(15 to 64
Youth
(15 to 24
years old)
• Self-employment rates have been stable over the last decade.
• Youth self-employment rates are approximately one-third of the adult rates.
Source: Eurostat LFS

7. Self-employment rates in Member States
0
5
10
15
20
25
30
35%
Adults (15 to 64 years old) Youth (15 to 24 years old)
• Youth self-employment rates vary substantially across Member States.
Source: Eurostat LFS

8. Barriers encountered by young
entrepreneurs
0
5
10
15
20
25
30
Not enough
capital
Current
economic
climate is not
good for start-
ups
Not enough
skills to be self-
employed
No business idea Difficult to
reconcile with
family
commitments
Risk of failures
and its legal and
social
consequences
are too big
Administrative
difficulties
%
Adults (15-64 years old) Youth (15-24 years old)
Source: Flash Eurobarometer #354
• Youth perceive greater barriers to self-employment than adults, particularly
related to financing and skills.
Barriers to self-employment, 2012

9. The opportunities to develop policy
actions using European Funds
1. European Social Fund
Under the thematic objective 'promoting sustainable and quality employment
and supporting labour mobility':
(i) Access to employment for job-seekers and inactive people, including the long-term
unemployed and people far from the labour market, also through local employment
initiatives and support for labour mobility;
(ii) Sustainable integration into the labour market of young people, in
particular those not in employment, education or training, including young
people at risk of social exclusion and young people from marginalised communities,
including through the implementation of the Youth Guarantee;
(iii) Self-employment, entrepreneurship and business creation including
innovative micro, small and medium sized enterprises;
(iv) Equality between men and women in all areas, including in access to employment,
career progression, reconciliation of work and private life and promotion of equal pay for
equal work;
(v) Adaptation of workers, enterprises and entrepreneurs to change;
(vi) Active and healthy ageing;
(vii) Modernisation of labour market institutions, such as public and private employment
services, and improving the matching of labour market needs, including through actions
that enhance transnational labour mobility as well as through mobility schemes and better
cooperation between institutions and relevant stakeholders

10. The opportunities to develop policy
actions using European Funds, continued
2. Youth Employment Initiative
– Activities supported include:
1. “Encourage schools and employment services to promote and provide continued
guidance on entrepreneurship and self-employment for young people.”
2. “Ensure greater availability of start-up support services.”
3. Europe 2020 Strategy
– Recognises entrepreneurship and self-employment as key for achieving smart,
sustainable and inclusive growth
– Several flagship initiatives address entrepreneurship:
1. Agenda for new skills and jobs;
2. Youth on the Move – initiatives on education and employment;
3. European platform against poverty and social exclusion.
4. Entrepreneurship 2020 Action Plan
– Section 4.2.4. Unemployed, in particular young people
Given the significant number of unemployed people across Europe,
entrepreneurship support schemes should be put in place to
encourage business creation as a route out of unemployment. Few
business development support schemes target unemployed youth specifically.

11. Start-up support as part of ALMPs, 2012
• Start-up support measures are not widely used in active labour market
policies
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0%
Source: Eurostat, LMP expenditure by type of action

12. Evidence that youth entrepreneurship
actions can work
Programme Country Target Type of
support
Impact estimate
.garage Hamburg
(ongoing)
Germany Unemployed
youth under the
aged of 35
Training,
finance,
incubator
83% of participants in 2000-
2002 carried on in self-
employment and 10% were
in employment or
apprenticeships.
First business year
baskets for youth
(2011-2013)
Lithuania Youth under the
age of 29
Vouchers for
BDS
Improved survival rates:
98.9% for 1 year vs. 63.3%
(2012)
Programme for
NEETs to move into
self-employment
(2007-2010)
Slovenia Unemployed
youth under the
age of 25
Grants;
training
Improved survival rates:
85% for first 2 years
The Prince’s Trust
Youth Business
Scotland
(ongoing)
United
Kingdom
“Unbankable”
youth who are 18-
25 years old
Finance;
coaching and
mentoring;
training
Generated 155 additional
start-ups in 2004/05 and
416 start-ups started sooner,
on a larger scale, or higher
quality.

13. Keys to success
• Support and build sustainable self-employment
projects:
1. Use strong selection criteria to identify ideas with the greatest
chances of success;
2. Use staged-selection where participants receive increasing levels of
support after demonstrating capabilities;
3. Provide complementary supports to ensure that youth develop
potentially sustainable projects (e.g. training and mentoring).

14. Keys to success, continued
• Avoid common pitfalls when designing and
implementing entrepreneurship support for youth:
1. Supporting projects in excess supply industries;
2. Financing projects with little chance of success;
3. Providing insufficient financial supports that cannot lead to the
creation of sustainable businesses;
4. Providing temporary, one-shot supports.

15. Conclusions
1. Start-up support programmes are under-utilised in response to
youth unemployment.
2. Start-up support programmes need to respond to market failures
in accessing finance and developing entrepreneurship skills.
3. Well-designed youth entrepreneurship programmes can work well
and have demonstrated success in the EU.
4. The keys to success are:
1. Select ideas with the greatest chances of success;
2. Use staged-selection that based on a demonstration of capabilities;
3. Use complementary supports to ensure that youth develop
potentially sustainable projects (e.g. training and mentoring).

16. More information on youth entrepreneurship
http://www.oecd.org/cfe/leed/inclusive-entrepreneurship.htm