Millenials and Entrepreneurship

Here is Alexis Ohanian, co-founder of Reddit, being interviewed about Millennials, opportunities for start ups, and the sudden burgeoning of entrepreneurship among young people.  This blog has covered before the situation young people are in coping with the present bad economy. Ohanian point, that the lack of economic opportunities means that there's no opportunity cost for entrepreneurship, and that this is the silver lining in our economic cloud is an interesting one. He also points out that the barriers for entry into business have never been lower because of increased access to consumers and open source software.

Michigan Future, Inc. put out a report several years ago with the purpose of attracting knowledge workers to Detroit and thereby encouraging the revitalization of downtown Detroit. Their "knowledge workers" are Ohanian's audience as well - young, very bright, creative, willing to work hard and take risks. In the past they've gone where the jobs are and taken their energy and drive with them, reducing the fortunes of smaller cities already on a downward spiral and enriching larger cities with, arguably, enough knowledge capital. Now, however, with good jobs hard to find nationally, they have incentive to stay where they are and build their own opportunities.

The less fortunate part of this is that knowledge workers - people who can create with "a laptop and an internet connection" are only a small subset of the general population. Most would be small business entrepreneurs still need some capital to get started. Even if you have the knowledge to build a parts washer to spotlessly clean engine liners, you can't do it without investment capital. While some small businesses can be run from home, manufacturing plants, auto garages, medical care centers, and organic farms, to name but a few, cannot, and those are the businesses who will hire workers who are not knowledge workers but still need employment. The economy won't get better until there are jobs available to the average worker, not just the specialty one.

It is, however, a blessing for very bright people who don't want to move away from their communities to find their livelihoods. And, eventually, many knowledge workers do generate jobs from their risk taking. Reddit only has 28 employees, but Ohanian has other projects that fund average people looking for a break.  It's not an overall solution to the nation's economic problems, but for those people he's helped get exposure and funds it's been life changing. We need to see more of this virtuous cycle of economic activity.

The American Dream, Revisited

Unemployment is one of those dreadful words that has peppered our news religiously for the last decade.  It has ebbed and flowed with each year that passes.  To the average American, unemployment simply refers to whether one has a job; but to a Generation Y American the underlying meaning is much more complex.  

Generation Y, generally referring to those born in the early 1980s to the early 2000s, is the most educated group to ever face mass unemployment.  Millennials, as they are also referred to, were raised in a world that taught them to attend college after high school, graduate, and get a well-paying job in a company that provides benefits and a 401K.  The Great Recession, which began in 2007 and ended in 2009 severely hindered this reality.  

Laziness is a common misconception associated with Generation Y.  Graduates are scattered among society making coffee at the local Starbucks, checking out guests at Meijer, and cleaning houses weekly.  “Get a real job,” is tossed around lightly by older generations.  The sad truth is that 27-year old Amy does not want to be brewing your Pumpkin Spice Latte, but the cost of paying off her college education leaves her no choice.  Amy has to accept any job she is offered, even a minimum wage job with little to no room to be fastidious.  53.6 percent of college graduates 25 and under are either unemployed or underemployed, according to the Associated Press.  

Millennials unable to find jobs in their desired fields are turning to jobs that are severely beneath their skill sets.  Many 20-somethings graduated from college, only to find the pool of competing applicants had more than tripled while they were in school.  The dream of each generation doing better than the last seems as far away as that ideal job.  Born from Baby Boomer parents, the expectation of financial success still seems reasonable for Generation Y, but the economy simply cannot supply the jobs.  Since the recession began in December 2007, average incomes for 25 to 34- year-olds have fallen 8 percent.   

A report released in August 2013 by PayScale and Millennial Branding, claimed that Generation Y is specifically underemployed and overqualified for the jobs they are working.  During the Great Recession many Baby Boomers and Generation X-ers lost their higher-paying jobs and instead settled for lower-paying, entry-level positions that would have normally gone to Millennials.  Generation Y seems to have been left out of the equation, and pushed into un- or underemployment.  College grad Ys are routinely cleaning Boomers' designer homes, if they can find the work.

The outlook for Generation Y is definitely not as bad as it could be, but it is not the ‘American dream’ that has been molded by older generations.  This dream needs to shift into the reality of what the economy can offer this group of young people.  Different expectations need to be laid out and different aspirations set.  It may not be as bountiful as past generations, but it will not lack in creativity, innovation, and growth.    

Thinking About Hiring? Be Sure Not to Discount the Millennials

When a business begins to grow, it may mean that it's time to begin hiring people. Sure, your partner or your children may have been able to pick up some slack here and there, but a part-time or full-time employee can be much more helpful, considering the dedication they must have to the business. But how do you select the right employee from the candidate pool? The obvious answer is to interview the candidates and consider each of them individually, but what if your own thoughts about people--specifically, those in regard to age--are getting in the way of your selection? Your biases could be holding your company back, so you better get past some stereotypes that are floating around largely thanks to media.

Some of the most ridiculous stereotypes out there right now surround millennials, people born between the years 1982 and 2000. Considered to be lazy, apathetic, and prone to mooching, the millennials are getting a bad rap for reasons that escape many of those that are included in this demographic. Like baby boomers before them, the news media has put millennials under the microscope and dissected them bit by bit, typically reporting findings that are negative. For instance, a number of articles have highlighted the fact that some millennials are still living with their parents. Though this is true, wasn't it true for previous generations like Generation X? People fall on tough times and with the massive costs associated with college--and the social expectation to enroll--countless teenagers have been groomed into educated, indebted twentysomethings.

An infographic explaining some of the intricacies of Generation Y. | Courtesy of Flowtown

Combine this with the economic downturn and, suddenly, many of these newly graduated college students couldn't find a job, let along afford an apartment. When the media started asking why, they began examining and blaming the personality traits of those who had received the short end of the stick. Of course they found negativity and apathy and angst: Wouldn't you be upset if you were told that college would get you a great job and those expectations fell flat? So, now there is an educated class, eager to work toward and for their passions, but many people have been convinced that they are lazy good-for-nothings, further complicating the debts they cannot pay. These stereotypes are false--many millennials possess entrepreneurial spirits and tend to be marketing savvy. They know that quality of product matters and that success takes hard work--their life experiences so far have largely convinced them of this latter understanding. Moral of the story is this: Do not underestimate millennials when considering them for a position. In fact, don't underestimate any applicant based on your own assumptions--it could mean the difference between your business succeeding or failing.