Economic Recovery Persuades Entrepreneurs to Hire
Seventy-six per cent of the world’s top entrepreneurs plan to increase the size of their workforce in the year ahead by an average of 19%, largely driven by growing global demand for goods and services and technological advances reports EY, the tax and advisory services group.
The figures come from the to third
‘EY Global Job Creation Survey’
of nearly 250 EY World Entrepreneur of the Year (WEOY) finalists since 2000, released to coincide with the WEOY Awards 2014 held this week in Monaco.
When compared with chief executives (CEOs) of large corporates, entrepreneurs are taking a more active role in global job creation according to the EY study. Against this only 31% of CEOs surveyed said they intend to hire in the next year, with the analysis suggesting this reticence is driven by geopolitical concerns and cost cutting pressure from activist shareholders.
Nearly nine in 10 survey respondents said the main driver for hiring at home is a desire to make the most of a growing market for goods and services, with 61% of entrepreneurs confident in their home market’s prospects. The second biggest driver of employment is the improvements that technology and innovation have brought to companies.
“The results of our annual survey relay a consistent message – that entrepreneurs, as key drivers of innovation in the global economy, are job creators and are far less risk averse when it comes to employing new people than CEOs of larger companies,” said Maria Pinelli, EY’s global vice chair, strategic growth markets.
Technology creating jobs
Technology has emerged as a key driver of job creation among entrepreneurs, with 51% of survey respondents agreeing that investments made in technology have changed their workforce, while 81% say it has led them to hire. The survey shows that this is driven by the increased cost competitiveness technology brings (53%), and by technology and mobile working opening up a greater and more skilled pool of workers, with 55% of entrepreneurs planning to hire from outside of their country compared to 44% in 2012 and 2013.
When looking at who was hired by entrepreneurs in 2013, there has been a shift towards hiring at the entry level. Fewer ‘experienced non-management’ were hired last year than in 2011 or 2012, while jobs at the entry level, especially those requiring a degree or advanced degrees were up on the last two years. Entry level roles not requiring a degree held steady.
Confidence in the global economy is strong, with 47% of survey respondents confident, very or extremely confident and 46% somewhat confident. Entrepreneurs in Europe, the Middle East, India and Africa (EMEIA) are the most confident about the global economy (with 63% confident, very or extremely confident), and are also the most likely to tap into the global workforce, with 65% saying they’ll hire from overseas, compared with 53% in the Americas, 33% in Asia-Pacific and 52% globally. Entrepreneurs in Asia-Pacific are keenest to hire in order to expand into overseas markets (58%), followed by EMEIA (54%) and the US (46%).
The full EY Global job creation report is available at www.ey.com/jobcreation