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Growing youth employment through entrepreneurship: Snapshot

Why is entrepreneurship an attractive strategy?

Today, the job market in Australia is relatively buoyant – but not for young people. Australia is facing some of the highest youth unemployment and underemployment rates in recent times, particularly in regional centres. Structural changes in the Australian economy have left young people with fewer opportunities and with reduced prospects of any self-correcting, market-led solution to accessing sustainable employment.
Trend unemployment rates by age: November 2004 to November 2014

Source: ABS 2014a


One strategy is not to find jobs but to create jobs – jobs that may look very different from existing ones, in markets that may not even exist now. Entrepreneurship, in its various forms, is the innovative response to this recognition.

This snapshot provides information on ways in which commercial and social entrepreneurship can create new employment, learning and engagement opportunities particularly suited for young Australians. It suggests that entrepreneurship can help address structural issues in the Australian labour market by diversifying the range of business enterprises that are developed, thus offering both additional training and employment opportunities for a range of young people, and encouraging more young people to develop their own enterprises.

Entrepreneurship: what are we talking about?

The term ‘entrepreneurship’ covers a wide range of activities. While in its most literal meaning, an entrepreneur can be anyone who operates a business, the term typically refers to the work of developing businesses that are distinguished by innovation in the business model adopted, by a higher level of risk associated with that innovation (especially with regard to the creation of new markets) and by the entrepreneur(s) retaining a significant level of control over the creation of the new business. This briefing deals with two forms of entrepreneurship – startups and social enterprises – chosen for their potential impact on youth employment.

2009 - Main purposes of Australian social enterprises

Source: Barraket et al. 2010


Developing an entrepreneurship ecosystem

Internationally, entrepreneurship is recognised as an increasingly important mechanism for stimulating economic development. The United Nations Conference on Trade and Development (UNCTAD) has developed an Entrepreneurship Policy Framework that focuses on six components it considers vital for boosting commercial and social entrepreneurial activities.


Source: UNCTAD, Entrepreneurship Policy Framework and Implementation Guidance, 2012


Current initiatives and ways forward

Most actions designed to expand the entrepreneurial economy as a whole are likely to advantage young people. This is because many young people (particularly those experiencing disadvantage) are amongst the beneficiaries of expanding social enterprises, both as social entrepreneurs and as those receiving training and employment within social enterprises. Additionally, young people already form a large proportion of those interested in developing startups, because they are more likely to have skills in aspects of information and communications technologies, so often important for startups, and because they are often the demographic of choice as employees of high-tech startups with a public profile.

The social enterprise and startup sectors have identified measures to develop Australia’s entrepreneurial ecosystem. We have summarised both current initiatives and stakeholders’ suggestions for ways forward for public policy and practice to be developed for entrepreneurship to grow youth unemployment.

A national entrepreneurship strategy

Current initiatives

The Australian Government’s Industry Innovation and Competitiveness Agenda (IICA) is the key strategy to increase Australia’s competitiveness.

Ways forward

  • Develop a national youth entrepreneurship strategy
  • Establish a stakeholder advisory group for strategy and growing investment
  • Invest in consistent availability of data and evaluation to inform policy and practice
  • Consider how government employment and training programs can learn from or partner with employment-focused social enterprises

Optimising the regulatory environment

Current initiatives

To raise initial seed funding for startups and social enterprises, the IICA is offering proposals to enhance existing employee share schemes and has recognised the need to develop the regulatory framework to facilitate crowd-sourced equity funding.

Ways forward

  • Encourage procurement of services based on social value, as well as value for money
  • Further develop tax incentives for investors
  • Grow investment-ready social enterprises

Enhancing entrepreneurship education and skills

Current initiatives

Access to education, training and mentoring programs to develop young people’s entrepreneurial skills within Australia is currently piecemeal, possibly due to there being no overarching strategy driving this agenda. Examples include:

  • education and training programs aimed at developing young people’s entrepreneurial skills in Australian schools: including Club Kidpreneur, the Academy for Young Entrepreneurs and ABW Enterprise Education. Three further measures are proposed in the IICA to increase engagement of young people in training within businesses, including startups and social enterprises: the Industry Skills Fund, the Trade Support Loans program, and the Pathways into Technology Early College High School (P-TECH) model (DPMC 2014).
  • financial support, mentoring and technical training for young entrepreneurs: including New Enterprise Incentive Scheme (NEIS), the Prince’s Trust Youth Business International (YBI) and Business Enterprise Centres Australia (BECs).
  • support services for social enterprises: including Social Traders, Social Ventures Australia (SVA), The School for Social Entrepreneurs (SSE) Australia, and the Foundation for Young Australians (FYA) Young Social Pioneers (YSP) program.

Ways forward

  • Embed entrepreneurship skills from primary school onwards
  • Expand proven skills and training pathways
  • Expand support and mentoring programs to support young people setting up and running enterprises
  • Invest in professional staff support within social enterprises to support specific young people to stay engaged and achieve their skills and employment goals.
  • Provide a supportive environment that accepts creativity, risk, failure and multiple attempts
  • Nurture computer coding skills for high-tech startups

Facilitating technology exchange and innovation

Current initiatives

Promoting networks and clustering support for enterprises can help spread learning about technology and promote innovation. There are a number of current and proposed programs, which provide elements of sharing skills for innovation across Australia, as noted in Enhancing entrepreneurship education and skills above. Moreover, clustering special support, such as shared workspaces, can encourage shared ideas and partnerships that might lead to innovation, currently facilitated by communities, such as the Hub Australia. Building bridges between public bodies, research institutions, universities and enterprises is also flagged by UNCTAD as an important element of facilitating innovation through research, evaluation and development of ideas. Whilst there are a number of successful partnerships between these sectors, access to such partnerships for startups and social enterprises can be challenging.

Ways forward

A co-ordinated approach to facilitating technology and innovation is needed to ensure growth within commercial and social enterprises with the objective of growing youth employment. In line with UNCTAD’s framework, the following ways forward are amongst those identified as priorities by stakeholders:

  • Grow enterprise hubs in metro, regional and rural areas
  • Co-ordinate, facilitate and grow research, evaluation and development partnerships

Improving access to finance

Current initiatives

Current access to funding for startups and social enterprises is again piecemeal and, according to advocates, tends to be focused on later stage ‘proven’ enterprises. Examples include NEIS, the Prince’s Trust Youth Business International, Startmate, Research Connections and Commercialising Ideas, and the Social Enterprise Development and Investment Funds (SEDIF). In terms of encouraging investment and relevant talent into startups and social enterprises, the IICA’s proposals to reform existing employee share schemes and facilitate crowd-sourced equity funding may stimulate further growth.

Ways forward

  • Encourage investment in early stage startups and employment-focused social enterprises
  • Maintain later-stage funding
  • Extend the NEIS support period

Promoting awareness and networking

Current initiatives

The Australian Government has recently amalgamated several of its business-related websites into a ‘single business service’ ( The IICA proposes the Australian Apprenticeship Support Network from 1 July 2023 to provide, ‘a one-stop shop for employers looking to hire a new apprentice suited to their business.’ (DPMC 2014, p.40).

Ways forward

  • Create an entrepreneurship hub

For full references please see the Growing youth employment through entrepreneurship brief.

Sources: Accenture and the G20 Young Entrepreneurs’ Alliance 2014; AVCAL 2014; DEEWR 2013; Duniam & Eversole 2013; Pinelli and Atalla 2014; G20 YEA Alliance 2014b; Hendy 2014; DPMC 2014; Kernot & McNeill 2011; PwC 2013; The Social Innovation, Entrepreneurship and Enterprise Alliance 2014; Social Firms Australia; Social Traders; StartupAUS 2014b; White 2014c.