SENIOR ENTREPRENEURSHIP IN SLOVAKIA Global Entrepreneurship Monitor (GEM) Evidences Anna Pilkova, Jan Rehak, Zuzana Kovacicova Comenius University in Bratislava, Faculty of Management
[email protected],
[email protected];
[email protected]
Abstract The issues of senior entrepreneurship in Slovakia, is currently not addressed by theoretical studies or government policies. Slightly better is the situation on the global level, where a limited number of theoretical publications regarding senior entrepreneurship were written. Increasing number of works begin to emerge in American and Australian literature. In Europe, leading role have the works of northern European authors, while in northern Europe and Great Britain, the issue of senior entrepreneurship is being addressed by government policies. The main goals of this article are firstly to summarize the current state regarding senior entrepreneurship in theory as well as praxis – studied principally through the government policies. Secondly, to analyze the position of entrepreneurial activity of seniors in Slovakia in comparison with the other European countries based on the data from a prestigious international research – the Global Entrepreneurship Monitor, as well as analyze the profile of senior entrepreneurs according to gender, education, income and motives leading them to entrepreneurship. According to the results of this study we propose policies, which would foster entrepreneurial activities of seniors in Slovakia.
Abstrakt Problematike podnikania seniorov na Slovensku sa zatiaľ nevenuje pozornosť a to ako v teórii tak aj vo vládnych politikách. O niečo lepšia, ale nie výrazne, je situácia na globálnej úrovni pokiaľ ide o teoretické práce, ktoré by sa venovali podnikaniu seniorov. Pomerne dosť prác sa začína objavovať v americkej a austrálskej literatúre. Z európskych štátov majú významnejšie postavenie najmä práce autorov zo severnej Európy, kde spolu s Veľkou Britániou, sa v porovnaní s ostatným svetom robí pomerne veľa aj v konkrétnych vládnych politikách. Cieľom nášho príspevku je okrem zmapovania súčasného stavu v teórii ako aj v praxi (skúmanej najmä cez vládne politiky) na základe dát prestížneho celosvetového prieskumu jednak analyzovať GEM pozíciu podnikateľských aktivít seniorov na Slovensku v porovnaní s európskymi krajinami participujúcimi na tomto prieskume, ako aj skúmať profil našich seniorov – podnikateľov a to z hľadiska pohlavia, vzdelania, príjmov ako aj motívov
vedúcich k podnikaniu. Na základe získaných výsledkov navrhnúť politiky, ktoré by bolo vhodné aplikovať na Slovensku s cieľom podporiť podnikateľské aktivity seniorov.
Introduction In the developed world the agenda of elderly people and their participation in the active labor force for a longer period of time is more important than ever before. Demographic trends show, that there is an increasing number in the older cohort of the population in many, if not all the developed countries. This fact draws more attention to the issues regarding pension and social security system sustainability. In the European Union the proportion of people over 55 in the population is predicted to rise from 30% in 2010 to 37% in 2030 (while in 1990 it was only 25%)1. This also directly influences the labor force which is consequently becoming older. European data show that proportion of labor force in the age of 55 - 69 rose by 26.5% in the period between 1987 and 20102. Favoring factors are the increased health and the ability of this age cohort to work and remain active for a longer period of time. Slovakia and its demographic characteristics are following some of the main trends of the western economies. The proportion of the elderly people is rising constantly throughout the past decades. The percentage of the oldest age group on the total population has been also increasing from 10.3% in 1991 to 12.7% in 2011. 3 Data from social security institutions indicate that the number of old age pensioners rose by 5.16% as well as demonstrating a certain serious trend in the development of demographics4. This trend allows us to state that the requirements on the pension and social security system in Slovakia will be rising. Dynamics of unemployment rate in Slovakia is another important indicator that demonstrates negative trends in the development of the labor force. The unemployment rate (individuals actively seeking for a job, listed in the Labor Offices) rose from 9.6% in 2008 to 14.1% in the first quarter of 2012.5 This figure shows that the percentage of individuals above the age of 55 on the total number of unemployed has been increasing steadily. Further analyses are focused on the proportion of older age cohort on the total number of unemployed. This figure shows that the percentage of individuals above the age of 55 on
1
HALABINSKY, D. POTTER, J. KAUTONEN, T.; Entrepreneurial Activities in Europe: Policy Brief on Senior Entrepreneurship; [online]; OECD Local Economic and Employment Development Division. 2 HALABINSKY, D. POTTER, J. KAUTONEN, T.; Entrepreneurial Activities in Europe: Policy Brief on Senior Entrepreneurship; [online]; OECD Local Economic and Employment Development Division. 3 STATISTIC OFFICE OF THE SLOVAK REPUBLIC; Demographic data – age structure of population; 2011. 4 SOCIÁLNA POISŤOVŇA; Počet vyplácaných dôchodkov v mesiacoch, štatistiky; 2012. 5 CENTRAL OFFICE OF LABOUR, SOCIAL AFFAIRS AND FAMILY; Unemployment statistics; 2012.
the total number of unemployed has been increasing steadily and achieved 13.8% in the first quarter of 2012 in comparison to 9.5% in the first quarter of 2008. This leads us to conclusion that not only the population and thus the labor force are aging, but the unemployed are aging as well. Trends described above underline that to study elder entrepreneurship in Slovakia as itself and in international context is more than required topic to get relevant information that are important for such policy creation that would contribute to solve addressed issues.
1
Aging and Senior Entrepreneurship in Contemporary Literature
Since we will be inquiring in the senior entrepreneurship, there is a need to clearly define the terminology. In the research there are various terms used to describe senior entrepreneurs, and yet they sometimes describe different groups of people. There is no consensus in the use or definition of this group. The most frequented terms used to describe this growing group are “grey entrepreneurs”, “seniorpreneurs”, “third age entrepreneurs”, “senior entrepreneurs”, “elder entrepreneurs”, or “second career entrepreneurs”6. Authors who established these terms often used different definitions. A rather broad and simplistic definition is used by Weber and Schaper when defining the “grey entrepreneur” as a person over a certain age (usually refers to 45 years old and higher) who starts or operates a small or medium-sized enterprise7. Regarding some of the studies written on this issue in Slovakia as well as focus of the European Union policies, we decided to set the age boundaries from 55 to 64 years of age. When analyzing the entrepreneurial activity of this group, in the later parts of this study we will be working with a GEM research results. This allows us, as well as limits us to use a definition of an entrepreneur set by Global Entrepreneurship Monitor, thus defining the entrepreneurs as actively engaged in either a start-up (total early stage entrepreneurship divides into nascent and new businesses) or an established businesses8. This definition allows us to compare and analyze the senior entrepreneurial cohort with respect to other age groups in the framework of GEM research The need to address issues of aging and senior entrepreneurship is being answered not only by the policy creators of the major economies, but in the recent years, also by researchers in various fields including labor market research as well as entrepreneurship. For example Ting Zhang in her extensive study on elderly entrepreneurship focuses on the assessment and
6
SEYMOUR, N.; Starting Up After 50; [online]; CELCEE Digest; 2002. WEBER, P. SCHAPER, M.; Understanding the Grey Entrepreneur; 2004. 8 PILKOVA, A. et. al.; Podnikanie na Slovensku: vysoká aktivita, nízke rozvojové ašpirácie; 2012. 7
evaluation of the situation in the United States9. Author analyzes the old-age effect on the entrepreneurship propensity, sources of the entrepreneurship, as well as the impact of this phenomenon on the fiscal, economic and labor situation in the country. Author emphasizes the extensive possibilities of elderly entrepreneurship in knowledge economy and recognizes several positive effects, which would an increase in the elderly entrepreneurship impose on the society. Among the main findings is the fact that there is a higher self-employment rate in the older group than in the younger cohorts of the population, and that the older selfemployed tend to concentrate in knowledge-based occupations. Another finding is that the elderly self-employed people have a lower retirement rate than elderly wage-and-salary employees, thus by promoting self-employment among elderly people, seniors could remain in the labor force for a longer period of time. Ting Zhang also focuses on factors that foster elderly entrepreneurship, where the most significant are lower taxes and higher level of cultural openness. The most interesting findings of the study include the impact of elderly entrepreneurship on economic growth, and effects on labor force and social security funds. Author found the elderly entrepreneurship is a significant positive factor for driving the regional economic growth. The economic impact of this kind of entrepreneurship seems to be stronger than other factors widely accepted in older literature, such as physical or knowledge capital, even the entrepreneurship of the young. Moreover elderly entrepreneurship was found to have a positive impact on the labor force participation and Social security fund surplus. Paull Weber and Michael Schaper10 research extensive number of studies focused on senior entrepreneurs (grey entrepreneurs, elderly entrepreneurs etc.) and give a holistic view on the work that has been done in the field of senior entrepreneurship research. They assess the demographic data and data on self-employment and small business enterprises, finding that the number in the older age self-employed individuals as well as small business owners is higher than in the younger age group below 30. In the first part of the study they define the concept of grey entrepreneur, where they identify four types of this kind entrepreneur based on Singh and De Noble11: Constrained entrepreneur is the one who has long desired to start a business, but lacked financial or family flexibility to fulfill his ideas. Rational entrepreneur sees self-employment as a progression of his or her career, or a way to increase personal wealth. 9
TING ZHANG; Elderly Entrepreneurship in an Aging US Economy; 2008. WEBER, P. SCHAPER, M.; Understanding the Grey Entrepreneur; 2004. 11 SINGH, G. and DENOBLE, A.; Early Retirees as the Next Generation of Entrepreneurs; 2003. 10
Reluctant entrepreneur is forced into self-employment due to a lack of acceptable alternatives and insufficient wealth to retire early. This kind of grey entrepreneur is considered by the authors, to be particularly relevant due to an increasing number of long-term unemployed individuals over the age of 55 in Australia. Also the Barclays Economic Report12 identified job retrenchment as the most important reason for starting a third age (senior) business. Lifestyle entrepreneur is the one seeking personal and financial success, especially in certain small business sectors and family businesses.
When comparing businesses of senior entrepreneurs (50 and older) with the businesses of younger entrepreneurs, authors Peters, Storey and Cressy 13 found that the businesses started by older entrepreneurs grew at a slower rate than the younger entrepreneurs’ businesses. On the other hand, The Economist 14 reported that in the United Kingdom the survival rate of businesses started by older entrepreneurs are higher than of those started by their younger counterparts. Around 70% of businesses started by entrepreneurs between 50 and 55 years old lasted over three years, whereas only 30% of the businesses started by 20 to 25 years old entrepreneurs were able to survive the first three years. The main advantages of the grey entrepreneurs are based on their experience, expertise, greater networks and possibly a stronger financial position. Logically one can only gain experience over a certain period of time, which would give the older entrepreneurs an upper hand in the field of technical knowledge about services or products, prior industry experience (which sometimes hinders creativity and innovation) or management experience. Another benefit of the older age is the possession of personal networks which may be very helpful when starting or operating a new business. Various papers on elderly entrepreneurship consider personal networks of the elderly entrepreneurs an important research point 15 16 . A study by Alizadeh17 confirmed that senior entrepreneurs over the age of 55 could rely on a broader range of networks than younger entrepreneurs. Considered one of the most valuable resources when starting a business, older entrepreneurs often have easier access to adequate
12
BARCLAYS ECONOMIC REPORTS; Third Age Entrepreneurs – Profiting from Experience; 2001. PETERS, M., STOREY, D. and CRESSY, R.; The Economic Impact of Ageing on Entrepreneurship and SMEs; 1999. 14 THE ECONOMIST; Face Value: The Pygmy Problem; 1999. 15 DE BURIN, A. and FIRKIN, P. Self-Employment and the Older Worker; 2001. 16 BARCLAYS ECONOMIC REPORTS; Third Age Entrepreneurs – Profiting from Experience; 2001. 17 ALIZADEH, Y.; Unraveling Small Business Owner/Managers Networking Activities; 2000. 13
capital for new venture creation and growth18. Older entrepreneurs can acquire such capital during former years of employment. In the United Kingdom, senior entrepreneurs tend to be wealthier than younger entrepreneurs according to Parker19. Better access to financing options most certainly is a factor positively influencing entrepreneurial behavior. Disadvantages of grey entrepreneurs are possible failing health or lower energy level, which could lead to lower productivity, thus preventing successful enterprise. As Curran and Blackburn note in their study, poor health is the most common reason why elderly people choose to retire from active working life.20 Other disadvantage of elderly people may be lower level of formal post-secondary education, especially in the field of entrepreneurship and management, than other groups of population.21 The cultural context plays an important role in grey entrepreneurship, while in a supportive society, that respects entrepreneurial mindset, elderly entrepreneurs thrive, whereas in a society where ageism and discrimination of elderly is common, entrepreneurship among this age group declines.22 A study of elderly entrepreneurs performed by Robert P. Singh23 draws the attention to the importance of elderly entrepreneurship in the US as well as in the rest of the developed countries. Study uses GSS (General Social Survey) data which counts with over 32 thousand respondents to a standardized questionnaire. One of the first findings the data provides, is that there is almost double the percentage of self-employed individuals in the older age group (over 55 years old) than in the younger age group (below 55 years old), and that it has been so for the past 4 decades. This finding corresponds with the 2009 report by the Kauffman Foundation, where the rate of entrepreneurial activity in the age group of 55 to 64 in the USA has been higher than in the much younger age group of 20 to 34 in the years 1996 to 2007 consecutively. 24 The results of the analysis show that older entrepreneurs have a similar income as younger entrepreneurs, but are significantly more satisfied with this income than their younger counterparts. In the educational attainment comparison, study shows that older population has a lower general education level, than the younger generations, and at the same time college degree has a higher impact on entrepreneurial propensity in the older age group
18
WEBER, P. SCHAPER, M.; Understanding the Grey Entrepreneur; 2004. PARKER, S. C.; Prosperity Not Poverty: An Investigation in to the Holdings and Distribution of Wealth of Older British Entrepreneurs; 2001. 20 CURRAN, J. and BLACKBUM, R.; Notes and Issues, Older People and the Enterprise Society: Age and SelfEmployment Propensities; 2001. 21 WEBER, P. SCHAPER, M.; Understanding the Grey Entrepreneur; 2004. 22 COUNCIL ON THE AGEING; Inquiry Into Issues Specific to Older Workers Seeking Employment, or Establishing a Business, Following Unemployment; 1999. 23SINGH, G. and DENOBLE, A.; Early Retirees as the Next Generation of Entrepreneurs; 2003. 24SHANE, S.; More Seniors Are Choosing Self-Employment; 2010. 19
than in the younger cohort. The results of the study show that there are significant economic benefits in the promoting of self-employment and entrepreneurship among the group of older individuals. Even a 1 or 2 percent increase in the entrepreneurial new venture creation rate among the elderly, could not only alleviate the pressure on retirement savings and social security funds, but could also result in the creation of tens of thousands jobs in the economy, the study states in the conclusion. In Slovakia there is no evidence of a publication that would be focused entirely on senior entrepreneurship. On the other hand there are some publications that are dedicated to senior employment support and active aging in the context of Slovak labor market, written by Institute for Labor and Family Research. These studies focus on the research of labor market, senior participation and attitudes in this field as well as possible measures dedicated to retain seniors in the labor market for a longer time.25 Other study focuses on the strategy of active ageing in the context of Slovak labor market, where it researches the key influencing factors of the senior economic activity as well as possible remedies to foster senior employment and participation26. There also exists a National program on active aging and solidarity between generations issued by the Slovak government. This program reacts to the European year of active ageing (2012) and focuses mainly of equal opportunities for various age groups, employment, social care as well as health care and education. This paper is structured as follows. After the introduction the second part discusses current literature and research works that focus on aging and senior entrepreneurship. The following core section contain research focus description, data and methodological issues overview, key findings coming out of analysis and discussion. The last section contains conclusions for policy makers and further research orientation.
2
Research Focus and Data
Due to missing research attention to importance of elderly entrepreneurship in Slovakia the primary intention of this paper is to study and analyze Slovak senior entrepreneurs within 2011 Global Entrepreneurship Monitor (GEM) Survey framework. Our primary objective is to focus on analysis and identification of key differences (if they exist) a) between senior entrepreneurs and youth at level of total early stage entrepreneurial activities (TEA) and established entrepreneurs (EB) in Slovakia; b) in rate of
25 26
KOSTOLNÁ, Z.; Podpora zamestnávania starších osôb; 2009. KOSTOLNÁ, Z.; Aktívne starnutie v kontexte trhu práce SR; 2008
Slovak senior entrepreneurs in both analyzed groups (TEA and EB) in comparison to the same categories in the Visegrad cuntries, the European countries participated in GEM 2011, Group of efficiency driven countries and globally, c) in attitudes of senior entrepreneurs in both groups (the TEA and the EB) entrepreneurs in Slovakia, d/in demographics (gender, education) and other characteristics (income) among senior entrepreneurs and TEA and EB entrepreneurs in Slovakia. In this paper we use data from the adult population surveys (APS) of the Global Entrepreneurship Monitor (GEM) from Slovakia and processed data of APS for Visegrad countries, Europe, Efficiency driven economies and globally. The GEM is an annual assessment of national levels of entrepreneurial activity, attitudes, aspiration and entrepreneurial frameworks in participating countries. GEM was initiated in 1999, however, Slovakia started to participate in this survey just since 2011 (in 2011 54 countries participated in APS survey). Detailed GEM methodology is described at Reynolds et al (2005)27. 2011 GEM results for Slovakia altogether with methodology description can be also found in Pilkova et al (2012). According to GEM methodology minimum 2000 respondents at each participating countries had been interviewed and included into analyzed adult population sample (APS). In our analysis we used both individual data for Slovakia and aggregated data for analyzed group of countries. We have analyzed senior entrepreneurs (55 - 64 age) according to selected phases (of GEM conceptual model (see figure 1). We studied seniors as potential entrepreneurs, in phase of intentions, total early stage entrepreneurial activity (TEA) and established entrepreneurs. We did not study the other phases of entrepreneurial model for seniors because of statistically not sufficient size of data sets. According to GEM model entrepreneurship starts with potential entrepreneurs – those who may or may not venture into entrepreneurship but their beliefs and abilities had been studied. Intentions represent the percentage of individuals who expect to start a business within the next three years. This intent is important measure of potential entrepreneurship. Total early stage entrepreneurial activity (TEA) includes those in the process of starting business (nascent entrepreneurs - up to three months) and those operating new business up to three and half year old. TEA is a key measure and focus GEM research. Established entrepreneurs are those in process of operating existing business more than three and half year old.
27
REYNOLDS, P. et. al;. Global Entrepreneurship Monitor: Data Collection Design and Implementation 1998 2003; 2005.
-
Figure 1: The Entrepreneurship Process and GEM Operational Definitions
Source: KELLEY, D. J., at al: Global Entrepreneurship Monitor 2011 Global Report, 2012, p. 5.
3
Results - Main Findings and Implications According to our primary objectives (see part 2) firstly a) we have studied age
entrepreneurial inclusiveness in Slovakia according to 5 age categories (see Table 1 and Table 2 in Annexes). Key outcome from this part of study is that in 2011 senior entrepreneurs have the lowest participation rate at the early stage entrepreneurial activities (TEA) in Slovakia (see Table 1). In the year 2011 TEA in Slovakia achieved 14.2%. The highest participation (32.4%) on this rate had the youth in the age of 25 - 34 and the lowest participation (5.6%) had seniors at the age category 55 - 64. If we calculate entrepreneurial activities within each age group (see Table 1) then percentage of senior entrepreneurs is again the lowest (only 4.7%), while the highest percentage (19.3%) belongs to age category 35 - 44. Senior entrepreneurs represent only 0.8% of the total Slovak population while the young people in category 25 - 34 are involved at early stage entrepreneurial activities (TEA) with the highest percentage of 4.6% on total population. Position of senior entrepreneurs among established business entrepreneurs (EB) is more favorable (see Table 2). Senior entrepreneurs participate by 17.6% on established business entrepreneurs (established business rate for Slovakia in 2011 is 9.7%) which is the
same rate as for 25 - 34 age category. This rate is the second lowest (the lowest rate is 1.9% for category 18 - 24). Senior entrepreneurs represent 10% of their age category and 1.7% of the population. b) Key finding from international comparative analysis of senior participation rate on TEA is that Slovak senior rate (5.4%) is the lowest among Visegrad 4 countries, the third lowest among European countries and is below average of the Slovaks´ peer group and globally. Further analysis also indicates that the Slovak rates is well below European average (10%) and significantly lower than the highest rate of Sweden (24.5%) (see Table 3). Studying data it is evident that former socialist countries have the lowest senior entrepreneurship rate in comparison to developed countries (some developed countries like Germany are exceptions within their peer group). Our senior entrepreneurs’ participation rate within the peer group (efficiency driven economies) is below average (7.36%) and also below global average (9.2%) which means below the average of all countries that participated in GEM 2011. Position of the Slovak established senior entrepreneurs’ participation rate (17.6 %) is slightly better in comparison to TEA entrepreneurs, although our rate is the lowest among Visegrad countries, below European average rate (22.0%) and below global average rate (19.5%) too (Table 4). The only above average position Slovakia achieved within the peer group (the efficiency driven economies established senior entrepreneurs participation rate is 16.9%). c) According to our objectives we studied attitudes of seniors in Slovakia (phase of potential). In this case we have analyzed the whole sample of seniors regardless of the stage of their involvement into entrepreneurial activities. Considering the attitudes, we have analyzed seniors’ opinion on entrepreneurial potential – their beliefs, abilities and intentions to start entrepreneurial activities in the next three years. Key findings are that seniors in general are more pessimistic and negativistic than their younger fellows. It is valid both for self-assessment of their abilities, as well as their perception of the opportunities (opportunities to start business within the next three years, self-assessment of their skills and higher fear of failure) and social attitudes to entrepreneurship (starting business as a good career choice, higher level of status and respect for those who are successful at starting business). The only area where they share equal opinion with their fellows is on public media in relation to starting entrepreneurs.
In general Slovak entrepreneurs have high level of self-confidence in comparison to Visegrad countries and Europe.28 Different results have been found for senior entrepreneurs. According to our results (Table 5) senior entrepreneurs see fewer opportunities to start business within the next three years than their younger fellows. While on average 76.9% of entrepreneurs don´t see good business opportunities in the next three years, almost 84% of senior entrepreneurs don´t see good business opportunities in the next three years in Slovakia. While 52.9% of Slovak entrepreneurs think that they have the knowledge, skills and experience required to start a new business, only 42.9% senior entrepreneurs think so. Almost 51% of senior entrepreneurs in Slovakia have fear of failure while average for all categories is 44.7%. Even though in general Slovak entrepreneurs believe in their abilities, they belong to those who are more negativistic among the Visegrad countries and Europe, considering the social attitudes 29 . Slovak senior entrepreneurs are even more negativistic than the Slovak average. While 54.4% of Slovak entrepreneurs think that starting business is a good career choice (see Table 6), only 52.2 % of senior entrepreneurs think so. The same trend is also valid for opinion on the statement, that successful individuals at starting a new business have a high level of status and respect. While 64.5% of all entrepreneurs think so, only 61.1% of senior entrepreneurs agree with this statement. Senior entrepreneurs share equal opinion as their fellows on the frequency of seeing successful stories on starting entrepreneurs in public media. More than 55% of senior entrepreneurs think that stories in the public media about successful new businesses are showed frequently. d) Finally our research was focused on the other dimensions of social inclusiveness of senior entrepreneurs studied through gender, education and income. Our key findings were that male predominance is even more serious for senior entrepreneurs than for all entrepreneurs in our sample. Participation of senior entrepreneurs as far as income is concerned follows similar distribution pattern as for the whole sample of entrepreneurs. Distribution of senior entrepreneurs according to education follows similar pattern as for all entrepreneurs, as well. However, percentage of graduates is the highest in senior entrepreneurs group. Gender is a serious issue for Slovak entrepreneurs in general. Low participation of women on entrepreneurial activities (below 30%) was specifically addressed as a serious issue
28 29
See more in Pilková, A. et al (2012), p. 76 See more in Pilková, A. et al (2012), p. 78
in the 2011 Global entrepreneurship monitor, too30. However, studying group of 55 - 64 years old (see Table 7) we found out the worst male to female ratio (8.1% vs 2%) among all age categories. It looks like women are even more reluctant to start and run business at the old age than in the younger age. Considering the income distribution among senior entrepreneurs it follows a similar pattern as for all entrepreneurs. 51.2% of senior entrepreneurs belong to the upper income third but it is the lowest percentage among all age categories and even below average (see Table 8). 37.2% belong to the middle income third and in comparison to the previous limit it is the highest percentage for all age categories and the lowest percentage – 11.6% belongs to the lowest income third. Majority of senior entrepreneurs have some secondary or secondary education (66.6% together). These two categories represent the highest percentage also in the rest of age categories. The lowest percentage represents post-secondary education among senior entrepreneurs. Portion of graduates among senior entrepreneurs (20%) presents the highest among all age categories and is well above the average of this education category.
4
Discussion and Future Research Direction
The empirical results of our study shows some differences of Slovak senior entrepreneurs’ dynamics in comparison to the American or the other international studies. One of the main differences is percentage of senior entrepreneurs both at total early stage entrepreneurial activity (TEA) and established entrepreneurs which is the lowest among all studied age categories of entrepreneurs in Slovakia. And above all this lowest or below average senior entrepreneurial rate Slovakia achieved in international comparison, too. According to our data similar situation, even not such severe, in this field is not only in Slovakia but also in the other Eastern European developing countries in comparison to developed economies. We can assume that previous historical development in the ex-socialist countries is the basis for explanation of this status. Older generation in these countries grew up under different conditions and people may miss entrepreneurial skills and aspirations. Here is a room for governmental policies to change it in favor of older individuals and their entrepreneurial orientation development at ex-socialist countries. One option how to improve current situation is to design and implement innovative educational program which could be run either through Slovak universities or governmental agencies that are responsible for 30
KELLEY, D. J., at al: Global Entrepreneurship Monitor 2011 Global Report, 2012, p. 15
entrepreneurial activity developing or in common cooperation. The other way is to allocate part of money directed by state for supporting job creation activities to incentives for senior entrepreneurial activities development (e. g. tax incentives, subsidies etc.). Special attentions in both of these types of activities should be given to women entrepreneurship. According to our studies gender issue in entrepreneurship in Slovakia is in general serious one in international comparison but especially severe is in senior entrepreneurship. As it is apparent from our study there is a shortage of research and literature on senior entrepreneurship worldwide and in Slovakia particularly. Therefore, we would suggest to focus future research in this field in Slovakia on the following topics:
Training, business advisory needs and other support that senior entrepreneurs need.
Women senior entrepreneurship issues.
Specific issues of finance senior entrepreneurial activities.
Conclusion Senior entrepreneurship is very important topic in all economies mainly due to current demographic development and economic crisis which heavily influences state budget deficits, high level of unemployment rates, social security system deficits etc. In addition to that as it is well known from the other researches, the knowledge based economy creates room for seniors to continue to work as entrepreneurs well beyond their retirement years and contribute to productivity of economic systems and solving some of issues addressed above. In spite of all these facts research on this topic is underdeveloped both in Slovakia and worldwide. Therefore, we prepared study that should contribute to limited knowledge and information in this field of research. We hope that outcome of our study brings relevant information both to policy-makers for their process of the relevant programs and projects design and researchers in development of their topics of future research orientation which could contribute to formulation of senior entrepreneurship theories.
Bibliography ALIZADEH, Y.; Unravelling Small Business Owner/Managers Networking Activities'; [online] Paper presented to the 45th International Council for Small Business World Conference, Brisbane, Queensland; 2000; [24.10.2012] available: http://sbaer.uca.edu/research/icsb/2000/56.pdf BARCLAYS ECONOMIC REPORTS; Third Age Entrepreneurs - Profiting from Experience; [online]; Barclays PLC, London. 2001; [23.10.2012] available: http://prime.org.uk/wpcontent/uploads/2008/12/barclays_report_on_third_age_entrepreneurs_july_2001.pdf CENTRAL OFFICE OF LABOR, SOCIAL AFFAIRS AND FAMILY; Unemployment statistics; [online]; Central Office of Labor, Social Affairs and Family Slovakia; 2012; [24.10.2012] available http://www.upsvar.sk/statistiky.html?page_id=1247 COUNCIL ON THE AGEING ; Inquiry Into Issues Specific to Older Workers Seeking Employment, or Establishing a Business, Following Unemployment; Federal Parliament, House of Representatives Standing Committee on Employment, Education, and Workplace Relations, Canberra, Australia; 1999; CURRAN, J. and BLACKBUM, R.; Notes and Issues, Older People and the Enterprise Society: Age and Self-Employment Propensities; In Work, Employment and Society,15(4): 889-902; 2001; DE BURIN, A. and FIRKIN, P. Self-Employment and The Older Worker; [online] Massey University of New Zealand, Auckland; 2001; [25.10.2012] available: http://lmd.massey.ac.nz/publications/Working%20Paper%20No4.pdf EMPLOYMENT INSTITUTE; Ekonómia trhu práce a jej implikácie pre Slovensko. Zborník príspevkov z vedeckej konferencie. Inštitút zamestnanosti. Bratislava 2009. ISBN 978-80-970204-0-8 HALABINSKY, D. POTTER, J. KAUTONEN, T.; Entrepreneurial Activities in Europe: Policy Brief on Senior Entrepreneurship; [online]; OECD Local Economic and Employment Development Division; [20.10.2012]; available: http://www.oecd.org/cfe/leed/Policy_Brief_Senior_Entrepreneurship.pdf KOSTOLNÁ, Z.; Aktívne starnutie v kontexte trhu práce SR; Bratislava: Institute for Labour and Family Research of Ministry of Labor Social Affairs and Family, Slovak Republic; 2008
KOSTOLNÁ, Z.; Podpora zamestnávania starších osôb; Bratislava: Institute for Labour and Family Research of Ministry of Labor Social Affairs and Family, Slovak Republic; 2009. PARKER, S. C.; Prosperity Not Poverty: An Investigation into the Holdings and Distribution of Wealth of Older British Entrepreneurs; [online] University of Durham, Durham; 2001; [24.10.2012] available: http://cosmic.rrz.unihamburg.de/webcat/hwwa/edok03/f10398g/WP0110.pdf PETERS, M., STOREY, D. and CRESSY, R.; The Economic Impact of Ageing on Entrepreneurship and SMEs; The Netherlands/United Kingdom, EIM Small Business Research and Consultancy and Warwick University, Brussels; 1999; PILKOVA, A. et. al.; Podnikanie na Slovensku: vysoká aktivita, nízke rozvojové ašpirácie; Bratislava: Univerzita Komenského v Bratislave Fakulta managementu, 2012. ISBN 978-80-223-2823-4 REYNOLDS, P. et. al. Global Entrepreneurship Monitor: Data Collection Design and Implementation 1998-2003. In: Small Business Economics, vol. 24 (3), 2005, pp. 205 - 231. ISSN 0921-898X SEYMOUR, N.; Starting Up After 50; [online]; CELCEE Digest; 2002 [25.10.2012]; available: http://www.eric.ed.gov/ERICWebPortal/search/detailmini.jsp?_nfpb=true&_&ERICExtSearc h_SearchValue_0=ED476585&ERICExtSearch_SearchType_0=no&accno=ED476585 SHANE, S.; More Seniors Are Choosing Self-Employment; [online]; In BusinessWeek.com vol. 1/13/2010; [22.10.2012]; available: http://www.businessweek.com/smallbiz/content/jan2010/sb20100112_799478.htm SINGH, G. and DENOBLE, A.; Early Retirees as the Next Generation of Entrepreneurs; [online] In Entrepreneurship Theory and Practice, vol. 27 (3), 2003, pp. 207 226. [24.10.2012] available: http://onlinelibrary.wiley.com/doi/10.1111/1540-8520.t01-100001/pdf STATISTIC OFFICE OF THE SLOVAK REPUBLIC; Demographic data – age structure of population; Statistic office of the Slovak republic; [online]; 2011; [24.10.2012] available: http://portal.statistics.sk/showdoc.do?docid=3021
Annexes Table 1: TEA in Slovakia in 2011 in the Age Categories Age TEA within age category Average TEA in age category TEA within adult population
18-24 16.2% 14.4% 2.3%
25-34 32.4% 18.4% 4.6%
35-44 27.1% 19.3% 3.9%
45-54 18.7% 12.0% 2.7%
55-64 5.6% 4.7% 0.8%
TEASK 100.0% 14.2% 14.2%
Table 2: Established Business in Slovakia in 2011 in the Age Categories Age EB within age category Average EB in age category EB within adult population
18-24 3.1% 1.9% 0.3%
25-34 17.6% 6.8% 1.7%
35-44 26.9% 13.0% 2.6%
45-54 34.7% 15.2% 3.4%
55-64 17.6% 10.0% 1.7%
EBSK 100.0% 9.7% 9.7%
Table 3: TEA in Age Categories in 2011 in Europe COUNTRY_NAME abbr. Slovakia SK Czech Republic CZ Hungary HU Poland PL Russia RU Romania RO Lithuania LT Latvia LV Croatia HR Slovenia SI Bosnia and Herzegovina BA Germany DE Switzerland SW United Kingdom UK Denmark DK Sweden SE Norway NO Ireland IE Finland FI Netherlands NL Belgium BE France FR Spain ES Portugal PT Greece GR Turkey TR Average Europe Rank SK Rank SK V4
18-24 16.2 18.7 14.6 10.4 14.5 13.9 27.6 19.7 12.0 13.3 21.3 19.1 7.6 14.9 10.6 9.3 3.6 11.1 10.7 12.0 11.1 8.2 7.8 12.1 10.5 12.0 13.2 6 2
25-34 32.6 28.3 25.5 37.8 33.8 38.4 29.7 35.6 29.1 31.0 30.9 20.7 19.8 25.1 20.0 14.6 21.5 31.9 27.3 23.1 35.4 33.3 33.0 34.9 27.5 39.5 29.2 10 2
35-44 27.1 26.4 26.2 24.1 26.4 18.1 19.6 21.1 30.7 27.7 25.6 28.0 29.3 27.0 33.1 28.8 33.8 30.7 26.6 26.9 29.7 28.8 34.1 24.3 32.9 26.2 27.4 13 1
45-54 18.5 17.6 25.9 19.0 20.1 22.2 17.5 16.4 18.3 15.5 16.5 23.3 30.0 20.6 24.9 22.9 25.2 20.3 20.3 25.9 11.3 21.5 18.0 17.9 14.5 19.6 20.1 16 3
55-64 5.6 9.0 7.8 8.6 5.2 7.3 5.6 7.1 9.9 12.5 5.6 9.0 13.3 12.3 11.3 24.5 15.8 6.0 15.1 12.1 12.5 8.2 7.1 10.9 14.6 2.8 10.0 22 4
TEA 14.2 7.6 6.3 9.0 4.6 9.9 11.3 11.9 7.3 3.7 8.1 5.6 6.6 7.3 4.6 5.9 6.9 7.2 6.3 8.2 5.7 5.7 5.8 7.5 8.0 11.9 7.6 1 1
Table 4: EB in Age Categories in 2011 in Europe COUNTRY_NAME abbr. Slovakia SK Czech Republic CZ Hungary HU Poland PL Russia RU Romania RO Lithuania LT Latvia LV Croatia HR Slovenia SI Bosnia and Herzegovina BA Germany DE Switzerland SW United Kingdom UK Denmark DK Sweden SE Norway NO Ireland IE Finland FI Netherlands NL Belgium BE France FR Spain ES Portugal PT Greece GR Turkey TR Average Europe Rank SK Rank SK V4
18-24 3.2 1.4 0.6 4.7 5.2 5.3 0.9 5.6 0.9 2.0 1.0 0.5 0.8 2.5 2.3 1.3 2.6 5.4 1.1 1.1 4.0 7.4 2.7 8.0 1.0
25-34 17.6 17.7 11.1 21.2 18.1 28.1 13.5 16.6 8.1 14.7 17.2 10.9 7.9 9.2 11.8 12.0 10.5 22.5 9.7 9.8 11.7 10.1 12.2 15.8 26.1 30.9 15.2 8.0 3.0
35-44 26.7 23.8 25.6 27.4 33.1 17.0 27.9 31.5 33.2 31.7 41.8 35.7 25.2 19.9 21.4 17.9 25.5 27.1 26.9 36.7 30.5 41.0 31.5 28.3 27.8 33.0 28.8 18.0 2.0
45-54 34.9 34.6 40.8 29.5 35.4 26.3 37.7 31.8 31.3 37.1 22.1 26.4 38.0 34.1 37.5 32.2 30.8 27.9 32.8 26.1 35.7 28.1 32.8 32.4 30.5 19.5 31.8 8.0 2.0
55-64 17.6 22.5 22.5 21.2 8.7 23.4 15.6 19.2 21.8 15.6 16.8 26.1 28.5 36.0 29.3 35.4 30.9 22.5 29.3 24.8 16.8 20.8 22.4 22.4 11.7 9.2 22.0 19.0 4.0
EB 9.6 5.2 2.0 5.0 2.8 4.6 6.3 5.7 4.2 4.8 5.0 5.6 10.1 7.2 4.9 7.8 6.6 8.0 8.8 8.7 6.8 2.4 8.9 5.7 15.8 8.0 6.6 3.0 1.0
Table 5: Percentage no/yes on item: In the next 6 months there will be good opportunities for starting a business in the area where you live? Age No within age category No within adult population Yes within age category Yes within adult population
18-24 72.1% 15.5% 27.9% 20.0%
25-34 70.0% 22.3% 30.0% 32.0%
35-44 79.2% 20.5% 20.8% 18.0%
45-54 81.0% 23.3% 19.0% 18.3%
55-64 83.8% 18.3% 16.2% 11.8%
Total 76.9% 100.0% 23.1% 100.0%
Table 6: Percentage yes on item: In your country, most people consider starting a new business a desirable career choice? Age Yes within age category Yes within adult population
18-24 60.5% 18.0%
25-34 58.2% 27.0%
35-44 51.5% 18.6%
45-54 50.5% 20.5%
55-64 52.2% 15.9%
Total 54.5% 100.0%
55-64 8.1% 2.0%
Total 71.5% 28.5%
Table 7: Percentage of male/female entrepreneurs Age Male Entrepreneurs Female Entrepreneurs
18-24 7.6% 3.5%
25-34 20.7% 6.5%
35-44 18.5% 7.8%
45-54 16.6% 8.7%
Table 8: Entreprenurs according to income recoded into thirds Age Lowest third Middle third Upper third
18-24 8.3% 33.3% 58.3%
25-34 9.3% 18.6% 72.0%
35-44 4.6% 29.4% 66.1%
45-54 16.2% 17.1% 66.7%
55-64 11.6% 37.2% 51.2%
Total 9.9% 24.6% 65.5%
