Politics Snippet - enable entrepreneurship, but not in an economic context

Enable entrepreneurship, but not in an economic context

Since the start of the economic crisis in 2007/08, governments in the developed world (and some developing countries) invariably started to promote entrepreneurship, especially amongst the young generation.

As we all recall, the starting point was to digest the graduates who struggled to find decent work. The expansion of tertiary education allowed a higher proportion of students to attend university, and this initially meant more workers to fill the higher-paid jobs. But this virtuous chain started to dry out in early 2000s when the expansion of professional job fizzled out, and the economic crisis simply finished it off. Those who have a few years' work experience or graduated with professional qualifications (lawyers, accountants) could continue to find high-paid jobs, but those with arts degrees or niche degrees such as drama could not compete in a job market which preferred the already-skilled without additional training needs.

The luckier ones could study a top-up degree and get the required qualifications for specific industries, but those ladened with debt could only find low-paid jobs with a potential to transition into a professional career path, or simply settle with jobs that do not require university qualifications. To absorb youth unemployment and to preserve the incentive for students to pursue university education, start-ups were encouraged to get graduates into employment or activities.

Of course, by early 2010s, some start-ups have become hugely successful and this created another virtuous circle that encouraged young professionals already in good employment to try out their ideas. The success stories also made governments' promotion of entrepreneurship schemes easier, with young graduates readily considering this path and venture capitalists entering the fold by establishing incubator schemes. The start-up scene became well-developed and a viable career in its own right. Graduates would not be considered "failures" if they went into entrepreneurship, and corporate employers were very willing to employ people coming out of the scene with or without success stories.

By now, in 2016/17, while the entrepreneurship circle continued to flourish, governments continued to promote this as a way out for young people, and recruiters very willing to source ex-entrepreneurs or start-up employees, the reason for building up the circle has shifted again. In addition to the employment issue that continued to plague the nations, the longer term impacts of artificial intelligence, greater internet connectedness and robotics are now leading a major change in societies' formation. Traditional knowledge-intensive jobs which are also process or rule-based, such as accounting and legal services, are now facing direct threats from artificial intelligence, further eroding tertiary education's prospects. To the governments, you either become an early adopter to transform and replace traditional knowledge-based economic activities with new creativity-based economic activities, or your traditional jobs get replaced by foreign firms' services. It's a new space that require new companies to enter and experiment, hence the encouragement of entrepreneurship.

These are sensible policies, but are they enough? With the rise of greater role of internet and digital services, it is not just commercial services that need to change, but public service provision and democracy and community as well. Funding crisis looms large in UK's health service and education, there are open demands for more relevant curriculum and teaching methods but the schools dare not make a change for fear of compromised league table ranking or funding shortfall. Creativity with new technology or quicker circulation & utilisation of information to synergise new solution allow communities to bring constituents together or generate new communities to meet hidden needs.

The above examples highlight how entrepreneurship and the spirit of experimenting with new technologies, methods and mentalities could bring value to the society, but these activities do not directly lead to profitable start-ups that could scale rapidly. They may be projects that fulfils its purpose and spirit away, or non-profit-making operations that require participants' continuous efforts to keep it running. Their value is apparent, but the monetary gain is elusive. Under the current entrepreneurship atmosphere, you may just as well not bother, as success is measured by fundings raised or annual growth %.

If profitability is the only yardstick, these alternative methods of utilising technology and knowledge would not scale, and their benefits could not be reaped. Arguably, that also shrinks the market size of new technologies and development potentials through more use cases by a wider audience. Should this kind of entrepreneurship not be encouraged? It simply sounds unwise.

So the challenge comes down to - how can governments encourage non-economic entrepreneurship, so that people are motivated to use new technology for even more purposes to make their and other people's lives better, but not necessarily making lots of money out of it.