Why Young Enterprise?
- Sep 26, 2012
Why on earth should schools spend precious teaching time helping teenagers to play at running businesses? Today's guest blog looks to provide the answers...
What is the point of diverting them away from academic theory to the manual labour of manufacturing products, erecting trade stands and keeping account books?
Surely it would be a massive diversion from drumming the three ‘Rs’ into their heads, especially at a time of questionable educational standards, sky-high youth unemployment and crisis over the stagnating economy?
And what, for goodness sake, would be the impact on their later lives of requiring them to spend a full year setting up, running and then dissolving a real profit-making enterprise with an average of 56 hours help from business volunteers?
Well, you may find the answer to these questions surprising.
To mark the 50th Anniversary of Young Enterprise we asked Kingston University Business School to study the impact of our work on the UK economy since the organisation was set up by merchant banker Sir Walter Salomon in 1962.
Senior researcher Dr Rosemary Athayde and her team conducted an in-depth nine month analysis of 371 individuals who took part in Young Enterprise Company and Start-Up graduate programmes over the past 50 years. She looked at what happened in their later careers and compared the outcomes to a control group of 202 non-alumni, adjusting for the different size of sample.
The results are utterly compelling:
Young Enterprise alumni are almost twice as likely to end up running their own firms as their peers by a ratio of 42% to 26%.
Their businesses have a larger turnover: for example three in every 100 alumni companies is now turning over £1 million, compared to none in the control group.
Alumni-run firms employ more people, with two in every 100 of alumni firms now employing more than 250 people, compared to none in the control group.
They are also more innovative and high-tech. Our sample shows that firms run by Young Enterprise alumni are most likely (21.2%) to be in digital businesses such as ‘cloud’ computing services. By contrast non-alumni firms are concentrated in fewer, more traditional areas such as healthcare and education (18%).
So why does this all matter?
As the 50 case histories featured in the new report show, the young people who get the chance to run businesses at school are emphatically not wasting their time. On the contrary they are acquiring vital employability skills - non-academic abilities including the ability to work in a team; a willingness to demonstrate initiative and original thought and self-discipline in starting and completing tasks to deadline. These softer skills are what employers are crying out for and that are crucial in enabling them to create the new businesses that are essential to Britain’s economic revival.
We know there is scepticism in Whitehall about the value of enterprise education. There is an argument that it simply helps teenagers from privileged backgrounds who would do well anyway. This report explodes that myth.
For example, Roy Stanley said that as a “working class kid with no exposure to business, Young Enterprise suddenly gave me a lot of knowledge”. Roy went on to establish The Tanfield Group, one of the world’s largest makers of commercial electric vehicles.
David Lammy MP was born in deprived Tottenham, London, one of five children raised by a single mother. He attended a State-funded school. He said Young Enterprise inspired him to be a leader and he subsequently became an Education Minister and a rising political star.
Naomi Kibble said the charity “planted the seed” for her crushed ice cocktails ‘Rocktails’ business.
Sabirul Islam, from London’s tough Tower Hamlets, has carved out a successful career for himself as a global speaker, published author and social entrepreneur at the age of just 21.
Multi-millionaire Nick Ogden, a former policeman and breakfast cereal salesman, invented the internet payment system WorldPay. He now presides over a business empire turning over £1.5 million a year said Young Enterprise was “critical.”
The Education Department has just abolished the statutory right of 14-16 year olds to work-related education. The evidence in this report shows that decision will have a long term negative impact on young people's employment prospects, business start-ups and therefore the economy. It also highlights a disconnect with the positive initiatives being launched by Dept. of BIS.
Government should be ensuring there is more work-related education in the classroom, not less.
You can read the full report “Impact: 50 Years of Young Enterprise”, here: www.young-enterprise.org.uk.
Michael Mercieca - CEO of Young Enterprise