Can entrepreneurship save Europe’s youth?

The world economy is slowly limping back to form after a few torrid years. In Europe, however, the picture is more sobering: unemployment remains stubbornly high (at 12% across the Eurozone as recently as August, according to Eurostat), while in October, the Red Cross shared the shocking discovery that 120 million Europeans are at risk of poverty and one third of them are not getting enough to eat.

No demographic group has been more affected than young Europeans, who face extraordinary levels of unemployment and social change in the wake of the crisis. Their confidence in the future is at a 30-year low. Young people are increasingly aware that the government can’t provide all the answers. They realise they need to seize their destiny and build their own paths to prosperity ­– but how will they fulfil their aspirations?

Although it is recognized that a culture of innovation and entrepreneurship is crucial, there are significant barriers to achieving it in Europe today. These include legal and regulatory roadblocks, limited access to markets and finance, and a lack of the required business skills.

However, what really holds Europe back is a fundamental aversion to risk-taking.

Innovation and entrepreneurship require a mindset with two main tenets: that fear of failure should not stop you trying, and that a simple idea can be developed into a successful project. Yet, by tradition, young people in Europe are encouraged to avoid risks and follow safe paths to jobs and financial security. This has led a generation of highly educated yet risk-averse young people to shelve their creativity and enterprising ideas in favour of stable and respectable careers, which themselves are becoming increasingly rare.

It appears that Europe has also been slow to encourage and reward risk-taking. Young people who have an innovative idea often find they don’t have access to the necessary finance, markets and resources, or that they lack the skills and infrastructure to develop their idea.

Not surprisingly then, Europe is losing the race to its global competitors when it comes to innovation and entrepreneurship. In comparison with the USA and Japan, and increasingly South Korea, China, India and Brazil, several indicators (such as the number of patents registered annually, new startups, and the percentage of GDP dedicated to research, development and innovation) appear to confirm this trend.

We at the European Young Innovators Forum firmly believe that Europe must change its outlook on innovation and entrepreneurship, and that young people can lead this transformation. All it needs is for them to turn their talents, energy, enthusiasm and fresh new ideas into successful projects, businesses, products and services.

The first step is to encourage young people to move out of the comfort zone and embrace new opportunities. This can be achieved by raising awareness, so that they consider alternatives to traditional careers. We also need to increase their access to skills training, mentors, finances and other resources; showcase entrepreneurial role models and successful innovations; encourage creativity with initiatives such as pan-European competitions for early-stage ideas; and provide networked facilities to help them turn their ideas into projects.

European governments need to work together with businesses, organizations and individuals to support and reward risk-taking. They can do so by establishing a regulatory framework that is tailored to the needs of entrepreneurs taking the first, tentative steps – ie one that prioritizes growth and offers concrete resources.

It’s time for a fundamental change of thinking in Europe. We need to create an entrepreneur-friendly culture that encourages young people to take risks and assume the lead on change and progress. At the European Young Innovators Forum, we believe this is how Europe can find a sustainable way out of its employment crisis.

Read Europe most bring the single market to the digital world by Neelie Kroes.

Author: Kumardev Chatterjee is the Founder and President of the European Young Innovators Forum (EYIF)

Image: People wait to enter a government-run employment office in Madrid September 4, 2012. REUTERS/Susana Vera