Youth Employment & Entrepreneurship...Youth Employment & Entrepreneurship Research Notes No. 1...

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29 November 2013 1 of 4 RESEARCH NOTES PEP Asia-CBMS Network Office Angelo King Institute for Economic and Business Studies De La Salle University - Manila Youth Employment & Entrepreneurship Research Notes No. 1 Review of Related Literature The global economic downturn brought about by the collapse of the US credit and housing markets in 2008 has had a huge effect on unemployment around the world. The youth (persons 15-24 years old) are among the hardest hit with unemployment figures tripling or even quadrupling in some countries during its onslaught. Five years after it wrought devastating impacts on economies worldwide, recovery prospects remain bleak with the International Labour Organization (ILO) estimating that 74.2 million youths will be unemployed across the world in 2013 – a 3.8 million increase from 2007 levels. This grim outlook prompts the need for strategies and interventions that can provide the youth with access to decent and productive employment. One of such programs is by building and fostering entrepreneurial mindsets and skills particularly among the young and disadvantaged people. These kinds of programs have been developed and applied, for instance, in Latin America, with very favorable results. Today, entrepreneurship is widely advocated as a means to battle unemployment especially among youths. Although the term “youth” has been coined in relation to a specific age range, youth is a more fluid category than a fixed age-group. For instance, youth in the African Youth Charter as well as in Singapore, refer to persons 15-35 years old. In the Philippines, it is defined as those persons with age ranging from 15-30 years old. In Ireland, the youth work program focuses on persons aged 10-25. In Bangladesh and Pakistan, youth refer to those who are 18-35 years old. Meanwhile, the 2009 Youth Survey in Haiti focused on persons 10-24 year- olds. However, for consistency across regions, youth is defined by the United Nations (UN) as those who are 15-24 years old. The ILO defines the unemployed population as “persons above a specified age who are available to, but did not, furnish the supply of labour for the production of goods and services. When measured for a short reference period, it relates to all persons not in employment who would have accepted a suitable job or started an enterprise during the reference period if the opportunity arose, and who had actively looked for ways to obtain a job or start an enterprise in the near past”. The US Bureau of Labor Statistics considers unemployed persons as those “who do not have a job, have actively looked for work in the
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  • 29 November 2013 1 of 4

    RESEARCH NOTES PEP Asia-CBMS Network Office Angelo King Institute for Economic and Business Studies De La Salle University - Manila

    Youth Employment & Entrepreneurship

    Research Notes No. 1 Review of Related Literature

    The global economic downturn brought about by the collapse of the US credit and housing markets in 2008 has had a huge effect on unemployment around the world. The youth (persons 15-24 years old) are among the hardest hit with unemployment figures tripling or even quadrupling in some countries during its onslaught. Five years after it wrought devastating impacts on economies worldwide, recovery prospects remain bleak with the International Labour Organization (ILO) estimating that 74.2 million youths will be unemployed across the world in 2013 – a 3.8 million increase from 2007 levels.

    This grim outlook prompts the need for strategies and interventions that can provide the youth with access to decent and productive employment. One of such programs is by building and fostering entrepreneurial mindsets and skills particularly among the young and disadvantaged people. These kinds of programs have been developed and applied, for instance, in Latin America, with very favorable results. Today, entrepreneurship is widely advocated as a means to battle unemployment especially among youths.

    Although the term “youth” has been coined in relation to a specific age range, youth is a more fluid category than a fixed age-group. For instance, youth in the African Youth Charter as well as in Singapore, refer to persons 15-35 years old. In the Philippines, it is defined as those persons with age ranging from 15-30 years old. In Ireland, the youth work program focuses on persons aged 10-25. In Bangladesh and Pakistan, youth refer to those who are 18-35 years old. Meanwhile, the 2009 Youth Survey in Haiti focused on persons 10-24 year-olds.

    However, for consistency across regions, youth is defined by the United Nations (UN) as those who are 15-24 years old.

    The ILO defines the unemployed population as “persons above a specified age who are available to, but did not, furnish the supply of labour for the production of goods and services. When measured for a short reference period, it relates to all persons not in employment who would have accepted a suitable job or started an enterprise during the reference period if the opportunity arose, and who had actively looked for ways to obtain a job or start an enterprise in the near past”. The US Bureau of Labor Statistics considers unemployed persons as those “who do not have a job, have actively looked for work in the

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    prior (4) weeks, and are currently available for work. Actively looking for work may consist of any of the following activities:

    Contacting: an employer directly or having a job interview; a public or private employment agency; friends or relatives; and a school or university employment center

    Sending out resumes or filling out applications Placing or answering advertisements Checking union or professional registers Some other means of active job search

    Entrepreneurship is considered as one of the driving forces of development particularly in modern economies. However, this term can be quite difficult to define despite the large volume of studies done on the subject. Moreover, a number of definitions exist on what constitutes “entrepreneurship” and who can be categorized as an “entrepreneur”.

    For instance, several contextual definitions are available that either define the process, gerund or the person (entrepreneurship, entrepreneuring, entrepreneur). The entrepreneurship field can be viewed as “the scholarly examination of how, by whom, and with what effects opportunities to create future goods and services are discovered, evaluated and exploited”. Meanwhile, entrepreneuring refers to “efforts to bring about new economic, social, institutional, and cultural environments through the actions of an individual or group of individuals.”

    Trofin, et al. (2011) asserts that the ‘hats’ of entrepreneurship are the entrepreneurs or business leaders who are creating new businesses at risk pressure to obtain the expected profit. The three terms are apparently interlinked wherein one can view as the set of traits as entrepreneurship and the one who possesses and acts on them is the entrepreneur.

    Ahmad and Hoffman (2007) defines another related term “entrepreneurial activity” as the “enterprising human action in pursuit of the generation of value, through the creation or expansion of economic activity, by identifying and exploiting new products, processes or markets”. While the entrepreneur can be the one who established the business as owners, entrepreneurs are also more involved and immersed in the activity.1

    On the other hand, national statistical offices in countries such as the Philippines operationalize entrepreneurial activity or a family-operated activity as any economic activity, business or enterprise whether agricultural or non-agricultural enterprises, engaged in by any member of the household as an operator or self-employed. This includes family-operated activities or those operated as single proprietorship or (loose) partnership.

    Thus, partnerships, corporations, associations, etc., which are formally organized and registered with the Securities and Exchange Commission (SEC), are excluded. A lawyer, dentist, physician, accountant, midwife, or any person in private practice of his profession with or without a regular helper is considered operating an enterprise as a business. A fisherman, farmer, carpenter, watch repairer, etc., working on his own account is also operating as an enterprise. This is also being adopted by the CBMS census in the Philippines. 1 For more discussion, see Dimaria, et al. (2006) and Ahmed and Hoffman (2007).

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