Entrepreneurs are an engine of job creation
In the spring of 2011, we asked over 8,000 Entrepreneur Of The Year winners from 35 countries about job creation. We found out that on average, they had expanded their workforce by 16% in 2011.
They also told us that 68% expected to expand their workforce in the country where they are headquartered and 44% expect to expand outside; some answered they were expanding both in their own country and outside, which explains the percentages.
As the world struggles to pull itself out of a disheartening economic downturn – we were intrigued. Just where were these entrepreneurs going to create jobs? And why?
We dug deeper into our original survey. We found that the biggest job creators—those who created > 50% of their new jobs outside their home country—were most active in Europe (40%) and Asia-Pacific (29%).
Asia-Pacific was understandable, but our curiosity was piqued by the larger draw toward Europe, considering its traditional high wage, high regulation environment. We wanted to know more.
Where is everyone going?
We found that the UK was the biggest draw in Europe at 12%, with France in second place at 4.8%. Quite a drop! Germany, the Russian Federation and Poland followed. In Asia-Pacific, China almost doubled the interest our treps showed in India, with 15.4% versus 7.2%. Afghanistan, Japan and Singapore also made the list.
Where are entrepreneurs going?
What’s the mindset?
Then, of course, we wanted to know the reasons behind overseas hiring. Was it the conventional wisdom of searching for lower labor costs? That factored in, but what really drove our respondents, by an overwhelming 69%, was the more growth-oriented push to enter new markets. Tapping new pools of talent came in at second at 29% with lower labor costs clocking in at 23% followed by boosting production at 21%.
Why are they going?
Who’s got the jobs?
Next, we wanted to know what industries were doing the hiring. Consumer goods took the lead, with construction close behind. IT and technology, energy, utilities, natural resources and mining came next.
Who’s got the jobs?
Keep going, treps!
The world applauds your ability to create jobs during these uncertain financial times. It's worth noting that the EY Global Capital Confidence Barometer, released earlier this week (and which polls more than 1,500 executives of the Fortune 500), shows the respondents planning to create jobs decreased from 41% in April to 28% in October. This is a significant shift in just six months.
Go treps go! The fact that the biggest reason behind the hiring is to enter new markets gives everyone hope that a return to growth may be right around the corner.