CLICK HERE to read the full Endeavor Insight report, “Poverty Reduction Through Job Creation & GDP Growth: Understanding the Potential of High-Impact Entrepreneurship.”
Every day, more than three billion people survive on less than $2.50, barely more than a single New York City subway ride. These three billion individuals are almost without exception unemployed, underemployed, or working in an informal economy with little income stability. Simply put, they are united by one desperate truth; they are a group who needs jobs. Tackling poverty and its entrenched roots is a fearfully complex undertaking with seemingly insurmountable obstacles. But what is clear is that any solution to poverty requires job creation. Viewed in this light, High-Impact Entrepreneurs who develop and lead companies with higher job creation and wealth generation than their peers offer some of the most exciting potential to reduce poverty in the world.
A new report by Endeavor Insight explores this theme through the analysis of three key premises. First, equitably distributed, stable jobs reduce poverty and high-impact entrepreneurship effectively generates these jobs. High-impact enterprises can generate 100 times more jobs than a microenterprise in the same period of time. Second, rising income levels are related to lower poverty rates, and high-impact entrepreneurs’ employees are paid better than at comparable jobs. Surveys also demonstrate that these jobs pay about twice as much as comparable positions, offer healthcare benefits 91% of the time, and enable over a third of employees to provide better educational opportunities for their children. And, third and finally, economic growth is good for the poor, and high-impact entrepreneurship significantly contributes to economic production. A 1% rise in mean income or consumption expenditures in a country corresponds with a 3% reduction in the proportion of people below the poverty line. In Mexico, for instance, it would take just 169 medium-sized enterprises expanding into large firms to raise GDP by a full 1%; 578,528 microenterprises would have to be created to have the same impact.
To learn more about how high-impact entrepreneurship has the potential to change the lives of billions–to reduce poverty and transform economies–please read the full report here.