The Unstable Stability: How Job Uncertainty Pushes Fresh Graduates Towards Entrepreneurship
In a world where job stability is becoming a distant dream, many fresh graduates are finding themselves at a crossroads. The traditional path of seeking a secure job is no longer as appealing as it once was, and a growing number are choosing to forge their own path by starting businesses. This shift is particularly evident in Singapore, where the economic landscape is currently uncertain, and job opportunities for young graduates are limited.
One such individual is Jeremy Lim, a 27-year-old marketing and journalism graduate who found himself in a familiar yet frustrating situation. After months of job applications with no success, he became disillusioned with the job market. The constant rejections and the feeling of needing an employer's approval to work were enough to push him towards entrepreneurship.
Lim's decision was influenced by a job interview in January where a recruiter offered him a significantly lower salary than advertised, highlighting the disparity between his qualifications and the opportunities available. This incident, combined with the pressure of impending wedding and mortgage bills, led him to take the leap into business.
He started Thirteen Employment Agency, a business that helps families hire domestic helpers. This venture is not his first attempt at entrepreneurship; Lim previously co-founded a business that made and sold earphones. The current job market, with fewer vacancies for young graduates, has made it easier for individuals like Lim to decide to work for themselves and build careers on their own terms.
The uncertainty in the job market and unmet job expectations are changing the calculus for many. Starting a business right away seems less risky compared to waiting for the right job offer. This shift in mindset is further supported by the fact that most entrepreneurs typically spend years in the workforce before starting their own ventures, building skills, savings, and networks along the way.
However, the job market's current state may be pushing young people to explore entrepreneurship earlier or view it as part of their portfolio of work. According to Associate Professor Marilyn Uy, the Provost's Chair in Entrepreneurship at Nanyang Business School, the opportunity cost of staying in the workforce decreases in a tougher job market. Fresh graduates are more willing to take the leap into entrepreneurship sooner because there's less to give up by doing so.
This sentiment is echoed by Lim Ee Ling, co-founder of entrepreneurship platform Wavesparks. She describes the mindset of some young founders: 'If the stable path is no longer stable, then why don’t I go and do this thing that I wanted to do?' The fear of bad company culture and poor management is also driving this shift, as many young people prefer to pursue their passions and take control of their careers.
The job market's challenges are evident in the data. Labour statistics show that the unemployment rate for those under 30 stood at 5.5% in September, while employers' hiring sentiment has weakened. The number of primary 'own-account' workers (self-employed) rose to 179,200 this year, with 95.5% choosing such work out of preference, the highest rate since 2016. This trend is further supported by the Accounting and Corporate Regulatory Authority (ACRA) data, which shows a steady number of new businesses registered by individuals aged 30 and below.
Despite the economic uncertainty, most young entrepreneurs are driven by opportunity rather than necessity. According to Professor Foo Maw Der, the President’s Chair in Entrepreneurship at Nanyang Technological University (NTU), most graduates who choose entrepreneurship do so because they have an idea they believe in or a problem they feel strongly about solving. Entrepreneurship appeals to a minority of students, between 3 and 5%, with the desire for career freedom being the most cited reason.
The shift towards entrepreneurship is occurring among those who are curious and open to the idea, who may have thought about starting their own business but only in the future. This group is increasingly taking the step now, making the jump into entrepreneurship.
For some, the push towards entrepreneurship comes from a futile job search. Demetrius Tan, a 28-year-old mechanical engineering graduate, found himself in this situation after sending out nearly 200 job applications without success. This led him to pursue his long-time dream of starting a 3D printing design business, Vincible3d.
Similarly, Eugene Chia, a computer science graduate from NUS, and his co-founders started their startup, Ecovolt Technologies, while still studying. They supply smart, energy-efficient building management systems. Chia's decision to start his own venture was influenced by the lack of suitable job offers and the desire to pursue his passion.
The trend of 'portfolio careers' is also gaining traction. This involves diversifying income streams and acquiring a variety of skills, rather than sticking to a single 9-to-5 job. It provides a sense of security and allows individuals to explore different opportunities.
However, starting a business at a young age comes with its own set of challenges, including the need for capital and the self-doubt that arises from straying from convention. Many young entrepreneurs, like Lim, have had to overcome these obstacles and find support from family or mentors.
Despite the risks, mentorship and a clear financial runway are crucial for young entrepreneurs. Mentorship can address emotional concerns and provide guidance, while a financial safety net allows individuals to take calculated risks. As Lim points out, every mistake, missed opportunity, and customer dissatisfaction is a learning experience, and entrepreneurs must embrace these challenges to succeed.
In conclusion, the traditional job market's instability is pushing fresh graduates towards entrepreneurship, offering them a sense of control and the opportunity to pursue their passions. While it comes with risks, the rewards can be significant, and with the right support and mindset, young entrepreneurs can build successful careers and contribute to the economy.
