Governments around the world are facing increasing pressure to reduce unemployment. According to the International Labor Organization (ILO), a deficit of 50 million jobs as compared to the pre-crisis situation is causing significant pressure on policymakers, particularly as this deficit disproportionately affects youth. One central strategy in addressing unemployment is to directly support unemployed individuals equipped with a business idea in starting their own company. For this purpose, several active labor market programs (ALMPs) have been developed, providing support to those seeking to start a business after a period of unemployment. This chapter provides an overview and analysis of such policy schemes from 12 European countries. The selection of countries seeks to reflect the diversity with regards to economic importance, political orientation, history and culture, as well as the variety of program structures that have been implemented. Similarities and differences between these programs are analyzed in order to contribute to increasing their effectiveness (for example, pointing out suitable policy instruments) and their efficiency (for example, by employing limited public funds with maximum.
Self-reliance through self-employment: an approach by The Church of Jesus Christ of Latter-day Saints
Geoffrey K. Davis and Andrew Maxfield
The Church of Jesus Christ of Latter-day Saints has taught self-reliance to its members since its founding in the early nineteenth century, but expansive growth since the 1980s in developing countries and especially amongst the poor has evolved the approach of self-reliance to proactively meet the needs of a growing membership. By identifying vital behaviors that lead participants out of poverty, the self-employment model, derived from microenterprise training, guides participants through a 12-week group program that emphasizes training, mentoring, and accountability. Self-reliance through self-employment traces implementation of a successful sample training model and plans for future development.
Jeff Roberts and Nathalia Myrrha
The Brazilian organization SEBRAE has reached millions of participants in the last fifty years. Its main focus is to help small businesses grow and improve. SEBRAE accomplishes its mission through five different areas: education training, business consulting, technical information, promotion and access to markets, and access to financial services. In addition to entrepreneurial training, SEBRAE provides business-consulting services.
Macarena Hernández, Gabriela Enrigue and Justin Oldroyd
Prospera is a social enterprise working in urban areas throughout Mexico. Prospera seeks to empower female-led micro businesses and connect them with citizens/consumers looking to create a more equal and engaged society. To achieve its mission, Prospera combines economic development strategies and training programs, to allow urban micro businesses to develop innovative and competitive products, with civic engagement activities, to incorporate consumers/citizens in the creation of these local products. Prospera’s mission and innovation potential is twofold. First, Prospera strengthens local economies by leveling the playing field for urban microenterprisers to take advantage of growing urban markets. Second, Prospera inspires and empowers Mexican consumers to support their own economy by engaging in the design, development and purchase experience of local products to transform Mexico into a more equitable society where microenterprisers and citizens can participate and thrive.
Gladys Gonzalez, Robert Heyn and Jessica Pino
The Pete Suazo Business Center (PBSC) offers business training to minority individuals living in Utah. Students who demonstrate a high commitment to their business education may become eligible for a micro-loan of US$5,000 or less which can help them acquire what they need to get their business started more quickly. Over the years, PBSC has helped hundreds of Hispanics and other minority individuals to create their own enterprise. Today, PBSC stands on the west side of Salt Lake City as a witness of what it means to live the American Dream achieved through hard work, integration to Utah’s society, generosity of donors and trust in God.
Philip Webb and Jason Fairbourne
Microfranchising has emerged as a compelling solution to the entrepreneurial burden. It is an innovative, market-based approach for development practitioners, NGOs, aid administrators, microfinance institutions, and especially necessity entrepreneurs to consider. At its core, microfranchising is a development tool that leverages the basic concepts of traditional franchising, but it is principally focused on creating opportunities for the world's poor to own and manage their own businesses, and to restore their self-reliance and human dignity. In this chapter we pinpoint the entrepreneurial burden by first, identifying the fallacy of the entrepreneur; and second, by exploring the nature of the necessity entrepreneur. We review the inherent risks and rewards associated with microfranchising. We demonstrate that above any other development tool or poverty-alleviating solution, the microfranchising model is more suited for the necessity entrepreneur and more completely addresses the fallacy of the entrepreneur.
Edited by Jeremi Brewer and Stephen W. Gibson
An estimated one billion individuals in both developed and developing nations can be defined as necessity entrepreneurs; individuals who have no other viable option for licit income than to start a small, income generating activity. However, the emphasis on providing business and leadership training to necessity entrepreneurs is only just gaining traction. This book provides the first-known global analysis dedicated exclusively to organizations from both the public and private sectors that are specifically involved with microenterprise education for necessity entrepreneurs. The authors provide a pragmatic synopsis and evaluate the efficacy of the programs that have been, currently are, or will soon be teaching and/or training necessity entrepreneurs around the globe.
Lingzhi Zhang and Spencer Brown
Capital is one of the most important factors in starting a business. But for many small- and mid-sized companies, borrowing money from banks is difficult because small loans have high marketing costs. Guarantee companies provide financing strategies that give smaller companies access to capital. These guarantee companies allow clients to borrow money from banks by guaranteeing the full payback of client debts. Hanhua Guarantee, a subsidiary of Hanhua Financial Holding, is one of the largest guarantee companies in China, Hanhua’s guarantee and microcredit programs help borrowers establish small businesses. This chapter provides background information on Hanhua, explains how it assists clients in obtaining funding and business training, and forecasts possible challenges facing Hanhua in the future.
The unemployment rate in Greece has increased dramatically since the beginning of the 2008 economic crisis. To control and reduce unemployment, several policy initiatives have been undertaken, including the implementation of programs that support the transition of individuals from unemployment to self-employment. The purpose of this chapter is to provide a brief overview of these government programs in Greece: the target group, the duration, and the financial assistance of the programs are presented, along with eligibility criteria and other requirements.