With the unemployment rate for young adults nearly double the national average, and with many predicting this generation will be the first in American history to do worse than its parents, it’s time to be worried about the future.
The millennial generation is by many estimates bigger than the baby boomers, and our success or failure will determine the fate of this country. It will take bold solutions to put our generation back on track and back to work.
But for now, let’s start with an idea that should be quick, bipartisan and popular: In an economy that’s not creating enough jobs for them, why not make it easier for young people to create jobs for themselves?
We’re a generation brimming with ideas and energy. We believe in the American Dream. We volunteer for organizations we think have real solutions and change lives. We have an intuitive understanding of technology: We grew up cruising the Internet. Identifying innovative uses for various technology tools is in our DNA.
A lot of us have ideas we think could make a buck, solve a problem or add value. We want to start our own businesses.
Yet for every story we hear of a whiz kid starting the next Facebook, thousands find steep barriers. Many would-be small-business owners are burdened by student loans, with the average college graduate $24,000 in debt. Even getting a loan of $5,000 to buy equipment or supplies is increasingly difficult — banks want to see collateral, and microloan programs aren’t reaching us in sufficient numbers.
At the same time, schools teach us many things but seldom how to draft a business proposal, apply for a loan or turn a business idea into a reality.
The good news is that there are real, common-sense fixes, even in tough economic times and amid the budget tug-of-war. Indeed, in an economy where there seems to be few easy answers, we actually do have some solutions to create tens of thousands of new jobs.
Here are three ways to turn the potentially “Lost Generation” into the “Entrepreneurial Generation.”
First, start a student-loan deferral or forgiveness program for people starting a business, much like the one that already exists for graduates entering public service. Imagine a graduate with a mountain of debt who can’t find a job. Instead of putting every cent into loan payments, they can invest in starting a business. If it works, they will have a job, maybe create other jobs, enrich our economy and pay off the loans. Of course, businesses have to be competitive, and some will fail. But this program could help young people create tens of thousands of new jobs in the first few years alone. The cost is relatively low and the systems are already in place.
Second, make it easier for young entrepreneurs to get loans. The Small Business Administration offers loans of less than $50,000, but the program is too small, and there are too many barriers for young adults to participate. Doubling the size of this program would cost little but provide much-needed seed money for budding startups. We should also create a young-entrepreneur lending program, with more outreach to young adults and a lessening of lending restrictions. That way, a 23-year-old starting a landscaping business could get a $10,000 loan to build a website, purchase equipment and advertise for those first clients.
Third, we need to bake business know-how into the cake — requiring, or at least incentivizing, meaningful entrepreneurial education and mentorship programs at the high school and college levels. It means high school graduates can write a business plan by the time they get their diploma. It also means the young adult who earns a certificate from a community college to become an auto mechanic should be able to take classes on how to actually run a garage. The private sector must also help by funding or encouraging more mentorship programs where experienced entrepreneurs give advice to new ones, and it should also fund technical assistance programs.
Fixing America’s economy is an all-hands-on-deck operation. And helping us create our own jobs is just one piece of a broader set of needed solutions. It’s true that change isn’t easy in the current political climate. But what’s more bipartisan or American than starting a business?
Jennifer Mishory is deputy director of Young Invincibles, a national, nonpartisan organization expanding opportunity for 18- to 34-year-olds.