Offering Minority Communities Equal Opportunities Through

Entrepreneurship

Dr Thomas M. Cooney

Academic Director – Institute for Minority Entrepreneurship (DIT)President – European Council for Small Business (ECSB)

President-Elect – International Council for Small Business (ICSB)

European Council for Small Business (ECSB) Approximately 450 members in 38 countries Free publications: ECSB electronic Newsletter; JSBM; InterRENT publications, ICSB Bulletins,

etc. Special Interest Groups: Entrepreneurship Policy, Female Entrepreneurship,

Doctoral Researchers, Entrepreneurship Education, and Social Entrepreneurship (see Linked In)

For younger researchers: participation at reduced rates at dedicated ECSB events Advice on personal career development at the ECSB Career Mentoring Programme 35% discount on all entrepreneurship books published by Edward Elgar 10% discount on Sage Publications Reduced rates for several entrepreneurship and small business journals (e.g. ISBJ) Automatic membership of ICSB (global organisation) Access to useful resources for academics in the field of entrepreneurship and small business Reduced registration fees to international conferences (e.g. ICSB World Conference) Regular competitions for ECSB members only Access to ECSB Webinar Series In November, Prof Luca Iandoli becomes President (1st Italian)

Ireland’s Network of Teachers and Researchers in Entrepreneurship (INTRE)

Increase in the standards of entrepreneurship education Regular emails giving you up-to-date information relevant to your work Access to the resources in the Members Only area of the INTRE website Free attendance at INTRE events Submissions to government and its agencies Free entry to INTRE competitions which provide valuable prizes Free teaching resources such as case study books Reduced rates for business magazines Usual professional benefits of being part of a professional network Representation at national and international initiatives Membership of the ECSB Contribute to IPREG Project (policy makers – entrepreneurs – academics)

No such organisation in Italy? Need to have a conference every two years? Need to get small business / entrepreneurship recognised?

Background to IME Established in 2006 Helping people to help themselves Partnering with relevant organisations Motto is “Build the person, build the business” – non-traditional

approach based on research Primarily a voluntary organisation, supported particularly by

people from the business community– DIT staff– PhD students– Board of Advisors– Community Leaders– Mentors

Moved from ‘bums on seats’ model to “business start-up” to “research centre”

Income Generation OptionsFor Each Individual

• Tax generating• Employment • Self-employment• Farming

• Tax usurping • State Support / Welfare• Crime

• Tax neutral (although may have positive / negative tax effect)• Begging • Inheritance • Marriage• Sponsorship• Pensions• Gambling

Key Minority Communities

Prisoners People with Disabilities Travellers (Gypsies) 50+ Gay Ethnic Muslim

These communities face additional and distinctive challenges in starting up their own business

Benefits of training around what it means to be ‘entrepreneurial’ can help them in their social as well as their working life

Prisoner Community

Ex-Prisoners - Economic Rationale

Reimprisonment rates in Ireland – 27.4% within 1 year– 39.2% within 2 years– 45.1% within 3 years– 49.2% within 4 years

Profile of reoffenders– 52% unemployed prior to reoffence– Male– Younger (under 30)– Property crimes (49% reimprisoned within 36 months)

Career options on leaving prison– Back to crime (costs state over €90,000 per year per prisoner)– State support (costs state in excess of €200 per week, higher

than average wage in most EU accession states)– Employment (contributes tax, hard to get a job)– Self-employment (contributes to tax and economic activity)

Distinctive E/Ship Challenges Faced By Prisoners

Lack of suitable contacts / role models Inability to drive due to lack of license Lack of financial support / credit history Credit payment schemes not available due to record Business insurance very expensive How to present yourself to the bank? Poor educational and literacy abilities Stigma attached to having a record Lack of follow-through, persistence, dedication (lack

will to overcome setbacks) Problems related to the dulling effects prison exerts on some

individuals Unable to test-market idea Lack of continuing support Lack of self-confidence (want to set up business while

in prison, but rarely follow it up on release)

Training Needs

Holistic approach needed Seed funding required Business mentors required Must have pre-programme interviews Build one-to-one sessions into the programme Only those being released within 12 months should be on

the programme Support of other organisations is critical

Italy - 69,158 detainees, no information on rates of reoffending

People With Disabilities

Employment Among Disabled

Lower rates of employment– US: 30.4% disabled v. 82.3% non-disabled– UK: 54% v. 84%– Ire: 37% v. 67%

Fewer in full-time employment– 63.9% v. 81.5% (US)

Lower levels of income– $29,513 v. $37,961

Poorer levels of education– 31% v. 15% not finished high school (US)– 26% v. 11% no educational qualification (UK)– 50.8% have no second-level education (Ire)

Motivations for Self-Employment

Desire to overcome disability Inability to secure / retain job Wish to increase income Flexibility in working hours and workload Rebuilding self-esteem Suits / accommodates disability Fear of discrimination in the workplace Autonomy from obstacles such as:

– Transportation– Fatigue– Inaccessible work environments– Need for personal assistance

BUT no tailored self-employment programmes available for people with disabilities in Ireland (few anywhere globally)

Barriers to Self-Employment

Difficulties in obtaining start-up capital– Lack of own financial resources– Poor credit rating– Disinterest from the banks

Fear of losing regular benefit income (‘benefit trap’) Unhelpful attitudes of business advisers Lack of customers Lack of access to appropriate training and support Difficulties in qualifying for minority focused financial

resources

Developing Appropriate Support

Address low educational qualifications Provide tailored training programmes (online) Provide on-going business support Establish microloan funds Implement disability awareness training for business advisers Facilitate self-employment through vocational

rehabilitation Actively market services to socially excluded groups Reduce work disincentives Address labour market disadvantages

Italy – approx 3,000,000 making approximately 5% of the population (in Europe it's 10%), Men: 40%, Women: 60%

Traveller Community (Gypsies)

Background to Irish Travellers Approximately 24,000 Irish Travellers Have their own distinct culture Suffer from limited education, poor health, discrimination,

etc General perceptions

– All Travellers want to live on the side of the road, – Travellers do not want to be part of Irish society, – Travellers are to blame for crime and anti-social behaviour, – Travellers are cheats who do not pay taxes and do not pay for the services that

they receive on halting sites, – Travellers are associated with violent behaviour (problems with alcohol), – Travellers are work shy

Significant amounts of money being given to this community through government schemes

Employment

Unemployment rates for female Travellers was 63% and 8% for the female population overall

Unemployment among male Travellers measured 73% and 9.4% for males overall

Travellers want to access waged employment but have– to hide their Traveller identity– a lack of recognised skills– low levels of education– to face discrimination in the marketplace

Traditional industries and skill needs are being lost to a knowledge-based economy

Laws on street trading had negative effect on Travellers

Future Developments Enormous challenges involved

– Societal perception– Traveller issues– No role models (‘nothing changed after the programme’)

Health and education need to be addressed as a priority Future programmes require 1-2-1 mentoring Role models needed to break through at local level Solutions need to be highly innovative and long-term in vision – not more

programmes that continue dependency Many previous programme providers have decided to no longer work with the

Traveller community. BUT – what does the Traveller Community want for itself? Lessons from / for Maori and Aboriginal communities?

Estimated 150,000 Roma, or Gypsies, live in Italy, many of them in encampments on the edges of cities such as Rome and Naples

50+ Community

Bad News ! Rapidly increasing rates of unemployment caused by

global recession Particularly difficult job prospects for people Over 50 If a person Over 50 loses their job, they have just

a 1-in-10 chance of finding a new position (UK Research)

Other income options include pensions, state support, or self-employment

Challenges to self-employment include:– Not having sufficient funds, or investing retirement funds

in start-up – Not preparing a succession plan or exit strategy – Physical limitations – Lack of experience in the market – "9 to 5" mentality – Lack of small business knowledge

Good News !

In the US, the rate of self-employment for the workforce as a whole was 10.2%, but the rate for workers aged 50-plus was 16.4%.

Although those aged 50 and above made up 25% of the workforce in 2002, they comprised 40% of the self-employed.

In the UK, businesses started by people Over 50:– Contribute £24.4bn to economy– Average turnover of £67,500 a year– Now account for 1 in 6 UK start-ups– Two-thirds regret not setting up earlier– Although older women start fewer businesses than men, women are twice as likely

as their male counterparts to set up businesses following big life changes such as ill-health, divorce or moving house.

Makes economic sense to support this community Italy - 65 years and over: 20.2% (male

4,903,762/female 6,840,444) (2010 est.)

Gay Community

Different Needs Internationally, 18% of gay community are entrepreneurs

– ‘Lavender ceiling’– No family commitments– Higher capital availability

Current research by IME suggests that:– 11% are entrepreneurs (417 responses)– 78.1% view themselves as ‘an entrepreneur who is gay’– Target gay community as one of many markets– Their desire to contribute to the gay community through employment, etc is of minor

significance– Have suffered abuse in personal circumstances but positive about business practice– Homophobia not an issue in starting a business

Helped establish IGBA – having a network is important Italy - 4,070,172

Ethnic Community

Ethnic Entrepreneurship in Ireland

Non-Irish nationals comprise 11.2% of population Approximately 12.6% of non-Irish nationals have partial or full ownership of

a business Ethnic businesses are

– primarily small in scale, – young in age, – concentrated in the locally traded services sectors, – operating at the margins of the mainstream economic environment,– 61% identified a business opportunity,– 75% of ethnic businesses are in operation for two years or less, – 94% employ 5 or less full-time staff, – 65% generated 50,000 euro or less in sales revenue in the last 12 months.

Ethnic businesses– Primarily target their own communities– These markets are too small to be sustainable (getting smaller)– Not potential HPSUs

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Challenges facing Ethnic Entrepreneurs (Experienced)

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Challenges facing Ethnic Entrepreneurs (Perceptual)

Securing Finance

Unfamiliarity w ith Business Environment

Discrimination

No Business Contacts

Language Barriers

Gaining Trust of Irish

Gaining Support from State Agency

Other

Key Considerations Ethnic businesses must include local population (good for

business, good for social integration) Strong potential for international trade Targeted intervention followed by mainstreaming of

enterprise support services should be the ambition Proactive role needs to be taken by enterprise support agencies

(use ethnic media – e.g. syndicated column) Raise awareness among the ethnic communities of the

availability to them of enterprise support Develop a ‘one-stop-shop’ website aimed at aspiring ethnic

entrepreneurs Foster enhanced linkages between national business

representative bodies and ethnic business communities

Muslim Community Initiative

Initiative to support greater entrepreneurial activity amongst Muslim Community in Ireland

Collaboration between academia, Muslim community (business and religious) and US Embassy (President Obama initiative)

Major national conference (Imam & US Ambassador) Prime time news and national newspaper coverage National survey completed and workshops currently taking place New network of Muslim business people being established in

collaboration of the Islamic Cultural Centre of Ireland Potential opportunity to extend this work globally through ICSB and

US State Department

Muslim Entrepreneurship in Ireland 48% are sole owners 68% less than 4 years old 74% employ zero or less than 5 people 46% are either in food or retailing 52% serve market within 30kms 42% have turnover less than €50k; 71% less than €100k 78% did not previously own a firm 76% said securing finance is the biggest challenge 48% said obtaining support from Enterprise Agencies was a challenge Lack of business contacts was also seen as significant challenge Largest source of finance is ‘own savings’ and ‘family and friends’ 90% said there is a need for Sharia Law compliant financial products 53% held business management qualification 63% had prior managerial experience 35% experienced discrimination from Customers

Conclusion “We treat everyone the same” is not working Must take a tailored approach to each community Working with organisations within the community must

occur Pre-start-up and early start-up requires our help,

afterwards they should be mainstreamed It makes sense economically and socially to take a

proactive approach that is based on results and tangible outcomes

Significant research, training and policy opportunities exist in all countries for work in these areas

Contact Details

Thomas.cooney@dit.ie 00 353 87 294 0812 www.ime.ie www.thomascooney.com