Belgians still too scared to become entrepreneurs

Results of the 2012 Global Entrepreneurship Monitor (GEM)

Overall, Belgians have a positive attitude to entrepreneurship as a career choice. However, it is surprising that successful nascent entrepreneurs enjoy little admiration. The status attributed to successful entrepreneurs therefore deserves to be improved. Moreover, the main factor keeping many people from becoming entrepreneurs is fear of failure. That goes mainly for women and youngsters, who need an extra push to take the plunge into the world of entrepreneurship. Finally, the factor of international migration was studied for the first time.

These are the results of the most recent Global Entrepreneurship Monitor, a yearly international study into entrepreneurial mentality, activity ratios of new and nascent entrepreneurs, and the ambitions of the latter. What makes this study unique is its focus on the attitude of the active population towards entrepreneurship, rather than on the number of people who effectively set up a new business. The results are based on a survey carried out in 2012. In Belgium, the study was conducted by Professor Hans Crijns and research associates Tine Holvoet and Niels Bosma at Vlerick Business School, in collaboration with the Research Centre on Entrepreneurship and Regional Economics (STORE), and it was commissioned by Kris Peeters, Flemish Minister-President and Minister of the Economy.

Positive entrepreneurial mentality but little admiration for nascent entrepreneurs

62% of Belgians consider entrepreneurship a good career choice. As such, the active population has a positive attitude towards entrepreneurship, at the same level of six European reference countries (Denmark, France, Germany, the Netherlands, Spain and the United Kingdom).

Strangely enough, though, the status attributed to successful entrepreneurs is very low. Barely 57% of Belgians thinks they are highly respected, making this the lowest score compared to all reference countries. Consequently, nascent entrepreneurs can indirectly perceive entrepreneurship as an unappealing career choice.

Hans Crijns, Professor of Entrepreneurship, thinks this is a striking paradox: “The Belgians consider entrepreneurship a positive career choice, and according to more than half of all Belgians interviewed – the highest share in ten years of research – the media also pays enough attention to the success stories of new businesses. In both views we are doing better than or equally well as the reference countries. Nevertheless, among the general population, successful entrepreneurs remain relatively unappreciated.”

  • 33% of the interviewed Belgians consider there are sufficient opportunities to set up a business, which is slightly lower than in 2010 and 2011, but exactly the same as the average of the six EU reference countries.
  • 4 out of 10 respondents trust their own abilities and think they have the necessary knowledge, skills and experience to set up a new business (41% in the six EU reference countries).
  • 4 out of 10 say that a fear of failure is what keeps them from setting up their own business (39% in the six EU reference countries).
  • 9% intend to effectively set up a new business within three years (10% in the six EU reference countries).

Number of nascent and new entrepreneurs decreases slightly after steady increase  

The TEA indicator (Total Early-stage Entrepreneurial Activity) for Belgium has decreased to 5.2% following a continuous increase between 2008 and 2011. This lower score is mainly linked to a low indicator for nascent entrepreneurship (i.e. new businesses where salaries have been paid for less than three months).

Target: international and innovative businesses, but little job creation  

Belgian nascent entrepreneurs have an international view of business (more than in the reference countries). That can be partly explained by our small, open economy and the lack of a significant language barrier with our direct neighbouring countries.
In terms of innovation we have sufficient ambition and our scores are similar to those of Germany, the Netherlands and Spain.
As for job creation, we are lagging behind compared to the reference countries, just like Spain. The percentage of new entrepreneurs who expect to create at least five jobs in the next five years is about 1%. That is half the number compared to the Netherlands and the UK. Further research could prove whether this is linked to the regulatory framework and perceptions on job creation and labour costs, or whether the Belgians are simply more realistic than optimistic.

International migration, gender and age

The 2012 research explicitly focused on specific groups of entrepreneurs for the first time, namely migrants, women and youngsters (18-34 years).

The survey among first- and second-generation migrants in Western Europe shows that they are more entrepreneurial than the Belgians. Moreover, they are more ambitious when it comes to job creation, and on a personal level, they also display several specific, inherent characteristics that could stimulate entrepreneurship. They do not rely on chance or luck for decision-making, they are very independent and less scared of taking risks. This first analysis provides too little information to make exact estimates, so further research in this field is desirable.

The gap between men and women was also analysed. Belgian women (3 out of 10) see fewer opportunities to set up a business than men (4 out of 10). Moreover, they are less confident of their abilities (3 out of 10 women versus 5 out of 10 men). Finally, their fear of failure plays a bigger part: 53% of women who have identified an opportunity to set up a business are afraid to fail versus only 33% of men.

Youngsters are a crucial group and require a good follow-up to limit the negative and possibly long-term consequences of unemployment (because of the crisis). Now that the traditional career path – “a job for life” – is becoming more and more rare, entrepreneurship offers the potential to boost employment rates. However, the number of youngsters who are afraid to fail when it comes to entrepreneurship is striking – 50%, the highest percentage compared to the six reference countries. 

ABOUT THE GLOBAL ENTREPRENEURSHIP MONITOR

Every year, the Global Entrepreneurship Monitor studies entrepreneurship through a survey among the active population aged 18 to 64. What makes this study unique is the very broad interpretation of entrepreneurship: the focus is not only on the number of people who effectively set up a new business, but also on the active population’s view of entrepreneurship.
In 2012 the GEM study was carried out in 69 different economies, and Belgium took part for the eleventh time. The conclusions are based on the Adult Population Survey, a survey among the Belgian population with a representative sample of 1,546 respondents, and on the National Expert Survey, which provides additional quality insights into the entrepreneurial climate in Belgium based on interviews with 53 experts.

ABOUT THE RESEARCH CENTRE ON ENTREPRENEURSHIP AND REGIONAL ECONOMICS

The Research Centre on Entrepreneurship and Regional Economics (Steunpunt Ondernemen en Regionale Economie or STORE) acts as an advisor to the Flemish government based on fundamental and applied economic top research in three fields: (i) nascent businesses and capital for entrepreneurs, (ii) the (further) development of SMEs, and (iii) the identification and measuring of economic clusters (with particular attention to the analysis and implementation of a new industrial policy). Moreover, the Research Centre on Entrepreneurship and Regional Economics is developing a database of regional and economic indicators (the Regional Data Warehouse, RDW).

Do you have plans to start up your own business? Be inspired by our Executive Master Class in Innovation & Entrepreneurship.

 

Related news

  1. Flemish lack of entrepreneurial spirit is culturally determined

    Date: 22/09/2016
    Category: Press Releases
    In Flanders, one in ten people plans to start a new company in the next three years. This is a record number in comparison to 15 years ago. The flip side is that people are doing this primarily out of necessity, because they have no other choice. The virtually unbridgeable gap between an opportunity and an actual start-up experienced by the majority of Flemings can largely be attributed to a fear of failure and a lack of confidence in their own ability. These are the most important conclusions of the 15th edition of the Global Entrepreneurship Monitor
  2. Vlerick launches two new, specialised masters programmes

    Date: 14/09/2016
    Category: Press Releases
    The beginning of the new academic year, which was ceremonially opened in Brussels this week, marked Vlerick Business School’s launch of two new masters degree programmes. Students can study for a Masters in Innovation & Entrepreneurship in Leuven and a Masters in International Management & Strategy in Brussels. Both programmes, which respond to a trend towards greater specialisation, immediately got off to a strong start with 29 and 35 students, respectively.
All articles