Small businesses and entrepreneurs are increasingly confident in a strengthening global economy – and they’ll be adding to their workforces as a result, says a new study. According to 2016 edition of the EY Global Job Creation Survey, smaller businesses are twice as likely to hire new staff this year than larger corporations.
The same survey found that disruptive entrepreneurs – those who change the rules of their sector – and innovative entrepreneurs – those who’ve created a brand-new product or service in the last year – are growing their workforces faster than conventional entrepreneurs.
Almost 2,700 entrepreneurs across the world were included in the survey, which found that 59% expect to increase their workforce in 2016 – more than double the proportion of large businesses expecting to do so.
“The disruptive force of technology is transforming individual companies and creating entirely new sectors. In this environment, entrepreneurs are pivotal drivers of global job creation, and in some cases are navigating economic and political uncertainty better than established players,” said Mark Weinberger, chairman and CEO of EY Global. “Technology is also transforming some of the most fundamental aspects of how we do business. This evolution will change what job skills are needed, which new businesses are created, it will impact our education systems and will challenge our regulatory systems.”
Overall, the global workforce of entrepreneurs is expected to grow by 9.3% in 2016, with 12% of new hires being young people in their first jobs, the report found. The hiring is being driven largely by increased confidence in the economy.
The survey also found that the more disruptive and innovative the company, the more people they’re hiring. And they’re hiring at a faster pace. The most disruptive entrepreneurs are 58% more likely to forecast expanding their workforce in 2016 than are more conventional entrepreneurs, the report said. And the net workforce growth of more disruptive companies – 18% – is twice the global average. And innovative entrepreneurs are 95% more likely to grow their workforce than are those who haven’t created a new product or service.
“The numbers validate what we have known for some time” the majority of entrepreneurs do well in business by challenging the status quo, asking difficult questions of incumbents and redefining the boundaries of sectors and industries,” said Uschi Schreiber, EY Global vice chair. “What is encouraging is that these disruptors are blazing a trail of growth in today’s fast-moving and transformative business environment, spotting opportunities and relentlessly executing on them, very often blind to existing sector or industry boundaries.”
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