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A new generation of imaginative entrepreneurs is

“ready and able” to take the UK out of its economic recession, according to a report from a leading educational society.

Young people who grew up around the turn of the century are more likely to want to set up their own company than previous generations, as indicated by the evidence from the RSA charity in partnership with the National Centre for Social Research.

The RSA - the Royal Society for the Encouragement of Arts, Manufactures & Commerce – is calling this new wave of business people the “millennial generation”, those born between 1980 and 1990.

They are described as displaying an “unprecedented entrepreneurial spirit”, with almost one third of those aged 20 to 29 years wanting to start their own venture.

The RSA’s report, called Generation Enterprise, concludes that the great rise in entrepreneurialism is a result of the millennial generation “grasping both the power of modern technology and the internet”.

The report’s author –

Adam Lent, RSA’s director of programme – said: “It will be the millennials’ insight and entrepreneurial spirit which will finally lift us out of the dire economic crisis. Over the coming years we will see younger generations produce new products and services that will generate a big leap in living standards.”

Consumers are beginning to control the processes of production, in a way that will be as signifi-

cant for living standards as the industrial revolutions of the past, according to the report, citing examples such as open innovation websites, social media companies, price comparison sites and peer-to-peer marketing sites.

“Now, a whole new way of doing business is emerging once again,” continued Lent. “The power to generate value, which was always the preserve of the entrepreneur and their business, is shifting to the consumer.

“Millions can now download products when, where and how they want them. Consumers now make their own content and share it online. Marketing is increasingly led by consumer-run networks. A new era is emerging in which value is self-generat- ed.

“But far from the entrepreneur becoming obsolete, this self-generated value transformation has unleashed a new wave of entrepreneurial-ism, particularly among the younger generation who are most engaged with the web and its possibilities.

“The reason is simple: if you can use the web to create things of value for yourself, you can also use it to create things of value for others. The very websites and networks that have given the consumer

power are also empowering entrepreneurs. As a result, product development, distribution, marketing and even financing have become much easier and cheaper,” said the report.

The proportion of people actively expecting to start their own venture has also risen, according to the National Centre for Social Research that helped compile the data.

In 1998, just four per cent of those aged 20 to 29 planned to start an enterprise in the 12 months after being asked the question. But by 2010, about 7 per cent of respondents in their 20s said they would start a business in the coming year.

The figures only include people already in employment, or self-employment, the RSA said. Unsurprisingly, among respondents with a desire to have their own company, half were already self-employed.

And according to the latest report involving Aston Business School, England, more people are expected to start their own enterprise in the future - or were actively trying to start a business - than at any time in the last 10 years.

The Global Entrepreneurship Monitor UK 2011 report highlights that for the first time since recording began in 1999, more than 20 per cent of the workingage population in the UK either expected to start a business in the next three years, were actively trying to start one, or were running their own company. GEM surveyed more than 10,000 people (www.gemconsortium.org).

The proportion of working-age adults actively trying to start a venture who were not already running another business rose from 2.9 to 4.1 per cent in 2011, while a further 6.8 per cent expected to start an enterprise in the next three years, up from 4.6 per cent in 2010.

Professor Levie said: “After the recovery in people’s entrepreneurial attitudes in 2010, we have seen a real increase in intentions and start-up attempts in 2011.

“While necessity-driven start-up attempts increased significantly, they comprised less than 15 per cent of all start-up attempts in 2011. Even in a continued recession, most entrepreneurs in the UK start up because they spot an opportunity.”

This increase in business start-up intention and attempts took place against a backdrop of continued decline in the use of external sources of funding of all types by start-up entrepreneurs since 2009.

Professor Levie added: “While this reduction is understandable in the current economic climate it raises the danger of under-funded and possibly short-lived start-ups. We need to find new ways to fund start-ups - and they are starting to appear, like crowd-funding and peer-to-peer lending.”

The report also revealed some differences in the barriers to starting a business that non-entrepre- neurs felt they faced and the challenges that start-up entrepreneurs said they faced.

Professor Hart concluded: “Non-entrepreneurs appear to underestimate the issues of appropriate skills, getting customers and staff, and the complexity of regulations. These are all areas where training could help nascent entrepreneurs.”

By Richard Maino