Job-seeking entrepreneurs: Planning for which future?
Many young micro-entrepreneurs in low-income countries engage in entrepreneurship while seeking salaried jobs, often overestimating their chances of transitioning to wage employment. Findings in this brief indicate that providing realistic job transition data can help these job-seeking entrepreneurs make informed decisions, potentially improving their business investment and profit outcomes.
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Dautheville-Policy-Brief-March-2025.pdf
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- Many young micro-entrepreneurs in low-income countries are not entrepreneurs by choice—they engage in entrepreneurship while actively seeking salaried jobs.
- This study finds that many "job-seeking entrepreneurs” systematically overestimate their chances of transitioning to wage employment and underestimate their business survival rates.
- Job-seeking activities are associated with reduced business investment and profit.
- Providing information on actual job transition rates reduces perceived job search returns and increases willingness to accept a salaried job at current earnings but does not significantly alter investment behaviour.
- Policies supporting entrepreneurship and job search should account for these dual aspirations to improve labour market efficiency and business outcomes.