A pioneering scheme to help students launch their own business is booming as the economic downturn triggers a surge towards graduate self-employment.
Only six months into the academic year, the number of undergraduates joining the Young Enterprise ‘Start-up’ programme has already overtaken last year’s full-year total by a large margin.
Last year some 1,391 undergraduates joined Start-up , a programme where business consultants help 19 to 25 year olds create their own company to run after they leave university. The students created 250 businesses at 26 universities and colleges.
Now, half-way through this academic year, the total is already 1,586 students, 14% up, and they are running 255 businesses at 32 institutions. Young Enterprise executives predict that the final total by the end of this academic year could reach 2,000 students, an increase of more than 40% increase compared to 2010-11.
With more academic institutions negotiating to join the scheme, the charity is looking to recruit extra volunteers from businesses to act as mentors to guide the expanding number of new student firms. The rapid expansion of the Young Enterprise scheme suggests a new generation of graduate entrepreneurs is emerging as traditional white-collar job prospects diminish.
Initially executives at Young Enterprise, the country’s largest enterprise education charity, were worried that the economic downturn and Government changes to university funding would hit applications for Start-up. But the reverse has happened.
In the midst of the worst employment market for 20 years, many undergraduates are opting to start their own businesses rather than wait for major firms to begin hiring again. They are entering a range of entrepreneurial markets – from selling exotic blends of tea to web design services, beeswax candles to high fashion knitwear – and some of their ideas are highly profitable.
The scheme, which began in embryo ten years ago, began to grow strongly when it was relaunched as the Start-up programme with powerful support from the former regional development agency One North East, Newcastle University and global banking giant Santander.
The programme spread fast and is already firmly established in the North East, Yorkshire & Humber, the North West, London and Northern Ireland. So popular are the courses that Young Enterprise is drawing up plans for a national Start-up Competition with regional heats leading to a UK final. From there the winners would progress to compete at a European level in the Junior Achievement-Young Enterprise Graduate Programme Final at Skopje, Macedonia in 2012.
Adam Soliman, who did Start-up at Newcastle University, set up specialist tea business ‘Charbrew’ in 2009. Now heading for £500,000 turnover this year he said: ‘ Young Enterprise gave me great insight into the initial structure of setting up a business, registering a company, setting up bank accounts, partnership agreements, trading terms etc. It also demonstrated to me how much time and effort is required to make a business work and especially on a collaborative group level.’
Catherine Marchant, Young Enterprise interim Chief Executive said: ‘These powerful figures indicate the number of graduates starting their own business is increasing because of the recession. With the graduate job market slowing, anyone who’s got a business idea has an even greater incentive to go ahead with it. As there are fewer safe jobs out there it’s a good time to take that risk. Thanks to the generosity of our supporters, Santander bank, Young Enterprise is there to help them carve their own futures. It is a massive demonstration of the power of enterprise education to transform young people’s lives and make a substantial contribution to the revival of the British economy.’