GEM 2006 South East Wales Report
18th Sep 2007 - 19:00:00More enterprise needed in the South Wales Valleys
GEM 2006 South East Wales Report (English)
GEM 2006 South East Wales Report (Cymraeg)
GEM study finds greater need for enterprise in South Wales Valleys
There needs to be greater effort in encouraging enterprise within the South Wales Valleys and helping individuals to overcome the key barriers to starting a business.
These are the findings of the unique Global Entrepreneurship Monitor study of South East Wales undertaken by Professor David Brooksbank and Professor Dylan Jones-Evans of the National Entrepreneurship Observatory for Wales.
The Global Entrepreneurship Monitor (GEM) was established in 1997 as a joint initiative between Babson College and London Business School. It describes and analyses entrepreneurial activity across a large and growing range of nations. Through producing internationally comparable data on the “elusive concept of entrepreneurship”, the GEM study is unique as the only longitudinal study of entrepreneurship undertaken throughout the major nations of the World. The project is supported by European Structural Funds, the Welsh Assembly Government, the University of Glamorgan and Cardiff University.
This year, the South East Wales annual entrepreneurship report shows that the proportion of adults involved in starting and managing a new business within South Wales Valleys was measured at 5.1 per cent, as compared to the 5.5 per cent for Wales as a whole. The main barriers to increasing the number of new businesses appear to be related to individuals’ perceptions, with a lack of opportunities envisaged by adults in the region, and a lack of confidence in having the skills to undertake a business start.
Professor Jones-Evans believes that this represents a continuing decline that needs to be addressed urgently by policymakers within the region.
“Whilst the number of new businesses being created in the South Wales Valleys is lower than for the rest of Wales, the study also shows that, in terms of established business ownership, there is a lower proportion of the population involved in managing an established business within the South Wales Valleys.
“This suggests a longer term pattern of lower entrepreneurial activity within the region which means a greater focus is required, through mechanism such as European Structural Funds, to ensure that more new businesses are created within some of our poorest communities, and that a sustainable local economy emerges that is based on the talents and abilities of local entrepreneurs.”
According to Professor Brooksbank, the lower level of entrepreneurial activity is a result of the entrepreneurial attitudes, as measured within the local population by the study.
“Entrepreneurial aspirations are found to be much higher outside the South Wales Valleys. For example, eight per cent of those living in the M4 corridor region aim to start a business in the next three years, as compared to only five per cent in the Valleys. Entrepreneurial aspirations in the Valleys are also below the UK average.
“It is also worth noting that only 25 per cent of adults within the Valleys believe there will be good start-up opportunities in the next six months, as opposed to an average of 37 per cent in the UK. Clearly, with less opportunities perceived in the market-place, then there will be lower aspirations, and hence lower levels of new business starts. There is also a lower proportion of individuals in the Valleys who believe that they possess the start-up skills required for a new venture than in the UK
“However, there are indications that there is a culture that values entrepreneurship within the Valleys, with 59 per cent considering entrepreneurship to be a good career choice and 77 per cent stating that entrepreneurship has a high status in society.
“Therefore, with the right programmes to stimulate further entrepreneurial activity, there could be the basis for increasing the number of new starts within the region.”
Copies of the other regional reports can be found at www.neo-wales.com/publications
