Looking at Europe’s Jobs Challenge: ‘A Way Out Does Exist!’

We are in the midst of an extremely delicate and fragile historical nexus. The crisis is worse than ever and is hitting above all those companies that are less-prepared and the weaker strata of society. Young people find themselves in ever-greater difficulty (one out of three in Italy and one out of two in Spain are out of work).  In Italy alone over the last five years the number of people employed under 35 years of age has decreased by 1.7 million.

A tremendous waste of resources and brain-power in an era in which these young people represent both the first digital and global generation! Today, technology offers opportunities that would have been unthinkable for previous generations.  But only those capable of adapting and understanding this change will be successful.

The unemployed in Europe currently number 25 million individuals, the equivalent of Portugal, Belgium and Denmark put together. Between 2008 and 2012, European manufacturing alone lost 3.4 million jobs (nearly 10% of the total in just four years) and the international labour organization has forecast that, over the next five years, the worldwide total will reach 210.6 million.

This situation must be reversed rapidly—not only can this negative trend be turned around, it must be!

If businessmen and decision-makers do not regain the required levels of confidence to once again begin to “risk” and invest in new activity, in innovation, in r&d and in technology, the positive driver for recovery will never be triggered.

Europe desperately needs more entrepreneurs and growth.  Without growth there is no employment and without jobs there is no future.

As Shimon Peres reminded us in this very place a few years ago, “entrepreneurs employ people, not infrastructures.

A study by the European commission has highlighted that new companies create over 4 million new jobs each year and are the primary source of new employment in Europe. Three million in the united states. The start-up act 3.0 of the us government declares that 40% of the US’s GDP derives from companies that did not exist prior to 1980. As a result, each year 6 trillion dollars in the United States alone derive from companies which until just a short time ago were only a glimmer in the imagination of some ambitious entrepreneur.

Entrepreneurship represents, therefore, the most potent impetus for economic growth.

Unfortunately, only 37% of European citizens are willing to be self-employed (this figure was 45% three years ago). In the us, 51% and 56% in China. The entrepreneurship divide, little quantified and analyzed, risks creating a real fracture in the prospects for future growth and prosperity in Europe.

What we need is an immediate, profound and broad-ranging cultural change, and we must recognize innovative entrepreneurs as a driving force in the economy of the 21st century and as creators of jobs and prosperity. This is a message that must be spread to all European governments so that Europe can become a hospitable environment for the best entrepreneurial minds to create a real entrepreneurial revolution.

The term entrepreneur comes from the latin word prahendere, which means to take something on, to assume responsibility. An entrepreneur is someone who launches something. The risks are certainly high and results highly uncertain.

Richard Normann offered us this wonderful image: “The entrepreneur should live in the here and now while being simultaneously a ‘visitor’ of the future and ‘exile’ from the past.”

But how can we guarantee the birth of a new entrepreneurship?

We see at least two lines of action:

  1. A.  The educational challenge

Unquestionably an important aspect in developing innovation and entrepreneurship is that of education and training from a very young age in order to develop within young people entrepreneurial attitudes and aspirations through fostering creativity and initiative. Young people should not have to “look” for a job, they should “create” one for themselves.

Entrepreneurship is an intangible factor born of a cultural approach. Entrepreneurs are born, but they are also created.  In our country, there are even courses in dog psychology. Why shouldn’t we study the psychology of entrepreneurs?

But what are the characteristics of an entrepreneur to be taught and fostered, above and beyond strictly technical and/or professional skills and knowledge? From our observatory, we can map out the following:

  • A marked tendency to taking on risks and challenges with a spirit of sacrifice that is decidedly above average, as well as the ability to make decisions quickly
  • A sense of ethics and courage
  • A desire for personal self-motivation and sense of responsibility (entrepreneurs clearly understand the difference between rights and duties)
  • Creativity and spirit of initiative
  • Tenacity, assertiveness, ability to persuade, together with the ability to work as a team and attention to interpersonal relations
  • Sense of initiative/optimism (the optimist sees an opportunity in every problem, while the pessimist sees a problem in every opportunity).

This must form the basis of any serious educational program.

In other words, being an entrepreneur is a “state of mind,” but also a key social function, like that of a doctor, teacher or clergyman.

A company is a social asset and entrepreneurs play the role of agents who, while pursuing their plan of wellbeing for themselves and their families, also create wellbeing for the community as a whole.

A famous entrepreneur once said: “My job is to chew so much glass and for so long until I no longer like the taste of blood.” This image is so stark that I feel I can taste blood as I talk to you.

As early as 2003, a number of countries launched educational initiatives in which entrepreneurship played a key role: the UK, Norway, Finland and Sweden were among the pioneers in this area and it cannot be accidental that these countries have had some of the best growth performances in Europe. More will be said about this in our research paper that will be presented tomorrow morning.

  1. B.   The eco-system challenge

Entrepreneurial education alone is not enough. We also need to recreate an environment in which new companies can be born, grow and develop.

If we look at Italy, it is not hard to understand how excess bureaucracy, inefficiency/slowness in the judicial system, labor costs and rigidity, problems of accessing credit—just to name some of the problems afflicting our country—have a negative impact on the ability to create new companies.

The creation of an entrepreneurially-favorable eco-system also involves a cultural change that does not severely penalize those who, launching a new activity, fail in their attempt. Someone who has failed will gain an important factor—”experience”—which means they will not repeat the same errors that led to their previous lack of success, assuming it was not caused by swindling or fraud, as has unfortunately been true in not a few cases.

Today we are facing the final call: we need reforms that are unequivocally pro-business in which entrepreneurship is the major asset to be unleashed and capitalized upon.

A friend of mine and entrepreneur, Silvano Mantovani, who is sitting with us here today, recently said to me: “we can’t look our children and grandchildren in the eye as they dream of their future and tell them ‘i’m not going to do anything for you because i’m weak and tired, i don’t have the courage and maybe i’m also partly responsible’ and leave them a world that is impossible and without hope.”

Speaking of hope, last week, the media throughout the world celebrated the 50th anniversary of the death of Martin Luther King, Jr., remembering his famous phrase, “I have a dream.” Let me close with another phrase of a famous leader about “dreams”: “The future belongs to those who believe in the beauty of their dreams.” So, please, let’s dream and dream all you can! No dreams à no vision à no entrepreneurs à no future.

The above is the text from the opening presentation by Valerio de Molli at the 39th edition of the Villa D’ Este economic workshop, “Intellingence on the World, Europe, and Italy,” held in Villa d’Este, Cernobbio (Como), September 6-8, 2013.

One Response to "Looking at Europe’s Jobs Challenge: ‘A Way Out Does Exist!’"

  1. lucad10   September 26, 2013 at 2:51 pm

    I suppose western countries can't dream anymore to create a majority of Einstein and/or Bill Gates like society: a rebalancing of x-rate regime vs. China (and similar) and an omogeneous set-up of business rules across WTO members may support a win win situation in the long term.

    Western countries still need to employ people in making clothes and other similar commodities. Creating an app for Iphone nowadays is a low cost country affordable job.