Small Business Majority: Scientific Opinion Poll shows Millennials identify student debt, retirement savings as barriers to entrepreneurship

A scientific opinion poll just released shows the majority of millennials (ages 18-34) who own a business or would like to start one at some point say student debt and lack of a retirement savings plan are barriers to entrepreneurship.

The poll, conducted Nov. 18-25, 2015, by North Star Opinion Research on behalf of Young Invincibles and Small Business Majority, found that the majority of millennials (51 percent) either own a business or organization, are planning to start a business, or would like to but do not currently have plans to do so. This shows that the entrepreneurial spirit is alive and well in the millennial generation, due at least in part to programs like Junior Achievement® that encourage students to think imagine their futures as community and world leaders, galvanizing change and creating opportunity for others. In fact, alumni of JA® programs are 50% more likely to start a business than those who never experience a JA® program throughout their educational career.

When it comes to starting a business, millennials identify student debt and lack of an employer-sponsored retirement plan as financial barriers to entrepreneurship. Nearly half (48 percent) of millennials paying off student debt who currently own or have plans to own a business say their student loan payments have impacted their ability to start a business. And nearly 4 in 10 (38 percent) millennials who are interested in opening a business but have no current plans to do so say their student loan payments affect their ability to start a business.

"Right now, I cover upfront necessities for my business, like insurance and marketing materials, out of my own pocket,” said Amanda Golden, co-owner of Designing Local in Columbus, Ohio. “My loans are currently deferred, but as soon as they're back on the table, using my own money to cover these costs will be out of the question. Student loans are really a burden that restrain my ability to run my own business. Millennials deserve a fighting chance to start small businesses, but student loans are holding us back." 

Young Invincibles, one of the organizations who sponsored this poll, is currently working to support two key policy changes that would make student loan debt less a burden for young business owners: allow borrowers to refinance their student loan debt; and let borrowers enroll in income-based repayment plans, so that payments go down if they're out of work and go up if they're successful and make more money. These changes would help alleviate the financial burden of student loans on young entrepreneurs with big dreams and crippling debt.

What’s more, three-quarters (75 percent) of millennials who own, plan to own, or would like to own a business say the lack of an employer-sponsored retirement plan is a barrier to entrepreneurship. This concern has been recognized at the federal level. As part of his upcoming budget plan, President Obama has proposed tax credits for small businesses to encourage them to offer retirement plans for their employees.

“Millennials show exciting levels of interest in entrepreneurship, yet youth entrepreneurship remains comparatively low,” said Rory O’Sullivan, Deputy Director of Young Invincibles. “This poll makes clear that millennials see student debt as a barrier as they explore a pathway to building their own businesses.”

“Entrepreneurship represents the pathway to success for many millennials, but they face significant hurdles to launching and growing their businesses,” said Conan Knoll, Vice President, Entrepreneurship, for Small Business Majority. “As this poll shows, student debt and lack of a retirement savings plan are a real problem for millennial entrepreneurs. Considering the majority of millennials are or would like to become entrepreneurs, it’s important to address these issues that are holding young Americans back from launching their businesses and helping our economy thrive.”