Global Entrepreneurship Monitor Scotland 2005

Jonathan Levie

Hunter Centre for Entrepreneurship University of Strathclyde

15 December 2006

New Business Activity: How Scotland Compares

2005 TEA scores for 35 sovereign nations & Scotland

0%

5%

10%

15%

20%

25%

30%

Hu

ng

ary

Ja

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Be

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Slo

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ly

Fin

lan

d

So

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Afr

ica

Au

str

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Fra

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Ge

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SC

OT

LA

ND

Sp

ain

Me

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Sw

itze

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Cro

ati

a

Un

ite

d K

ing

do

m

Gre

ec

e

La

tvia

Sin

ga

po

re

No

rwa

y

Ca

na

da

Arg

en

tin

a

Ire

lan

d

Ice

lan

d

Au

str

ali

a

Ch

ile

Bra

zil

Un

ite

d S

tate

s

Ch

ina

Ja

ma

ica

Ne

w Z

ea

lan

d

Th

ail

an

d

Ve

ne

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Pe

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of

ad

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p p

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n 1

8-6

4 y

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Scotland

United Kingdom

United States

Ireland

New Zealand

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

9.00%

North

Eas

t

North

Wes

t

North

ern

Irela

nd

Wal

es

East M

idla

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Wes

t Mid

lands

Yorks

& H

umber

Scotla

nd

East o

f Engla

nd

South

Eas

t

South

Wes

t

London

UK TEA

UK Regional TEA rates, 2005

Scottish TEA rates 2000 to 2005

0

1

2

3

4

5

6

7

8

9

2000 2001 2002 2003 2004 2005

Year

TE

A s

core

(%

)Males Females

1

3

5

Funding A

vail.

Gov. P

olicie

s

Gov. R

egs.

& In

stit.

Gov. P

rogs.

School E

duc.

Post-s

chool E

duc.

Tech. T

ransf

er

Bus. Ser

vice

s

Mar

k. C

hange

Mar

k. O

penes

s

Phys. I

nfra.

Nat. Ent.

Culture

Opportuniti

es

Ent. Com

peten

ce

Respec

t for E

nts.

IPR

Femal

e Ent.

Support

Hi Gro

. Ents

. Support

Scotland UK Hi income nations US Brazil

-ve

+ve

Scotland’s Environment for Entrepreneurship

Source: GEM 2005 Expert Interviews

0%

5%

10%

15%

20%

25%

30%

0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000

GDP per Capita 2005, in Purchasing Power Parities (PPP)

Per

cen

tag

e o

f p

op

ula

tio

n b

etw

een

18-

64 y

ears

EasternEurope

EU-15Countries

MiddleIncomeCountries

VE

NZ

HU

HR LV

AR

CL

TH

BR

CN

JM

MX

ZA

US

IS

CA

AU

SG

SI

ESGR

JP

NO

IE

DK

SW

UK

SC

HighIncomeCountries

New Business Activity and Relative Wealth

New Business Activity and Population Growth

0.0

5.0

10.0

15.0

20.0

25.0

30.0

-6 -4 -2 0 2 4 6 8 10% Population growth rate 2000-2005

2005

TE

A r

ate

(%)

Latvia

Hungary

SCOTLANDSingapore

Venezuela

New Business Activity and Established Business

0

5

10

15

20

25

30

0 5 10 15

2005 Established owner/manager rate (%)

2005

TE

A r

ate

(%)

SCOTLAND

Thailand

Hungary

ChinaUnited States

TEA rates by Global Region

0.02.04.06.08.0

10.012.014.016.018.0

Global Region

Ave

rag

e T

EA

rat

e 20

00-0

5 (

%)

TEA and High Expectation Entrepreneurship rates

0.02.04.06.08.0

10.012.014.016.018.0

Global Region

Ave

rag

e T

EA

rat

e 20

00-0

5 (

%)

00.20.40.60.811.21.41.61.8

Ave

rag

e H

EE

rat

e 20

00-0

5 (%

)

TEA HEE

• GEM Scotland surveys picking up more high expectation entrepreneurs

• No difference now in relative ambition between Scots and UK entrepreneurs

• Growing businesses experiencing skills shortages in sales

High Expectation Entrepreneurship

New Social Enterprise Activity

Are you, alone or with others, currently trying to start any kind of social, community or voluntary venture, activity or initiative? This might include providing subsidised or free training, advice or support to individuals or organisations; profit-making activity, but where profits are used for socially oriented purpose; or self-help groups for community action.

Source: Pooled 2004 and 2005 GEM UK data

TEA and SEA by Educational Attainment

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somesecondary

secondarycompleted

postsecondary

graduate

Educational attainment

% o

f g

rou

pScottish TEA Scottish SEA

UK TEA UK SEA

Scotland may have reached its “Natural” rate of new business activity.

Now What?

Focus on underlying drivers?(Wealth, population growth, business ownership)Focus on improving the environment?(Will affect only the ratio of HEE to TEA entrepreneurs)

Questions for Policy

• Move Social Ventures off short term grants to long term contracts

• Schools need more help from local entrepreneurs if Determined to Succeed is to truly succeed

• Higher Education must take Selling seriously if Growing Ventures are to fulfil their potential

• Major Entrepreneurship Education push needed in Further Education sector

Recommendations