On February 10, 2022, the 23rd annual report of the international research project "Global Entrepreneurship Monitor" (GEM) was presented at EXPO 2020 in Dubai. The study involved 115 thousand people from 50 countries, which account for 68% of the world's gross domestic product (GDP) and 45% of the world's population. In Russia, the project is being implemented by the research group of the Graduate School of Management of St. Petersburg University (GSOM SPbU) with the support of Sberbank.
“Entrepreneurship is proving its viability even in times of crisis. And if people hopes on protecting their health with a vaccine, then with entrepreneurship they pin their hopes on finding new opportunities and developing the economy,” said Olga Verkhovskaya, Head of the GEM project in Russia, Associate Professor at the Department of Strategic and International Management at GSOM SPbU.
Comparing GEM data before the pandemic, in 2021, and 2021 suggests that total early entrepreneurial activity (TEA) — characterizing the percentage of the adult working-age population (aged 18–64) who start a new business — has decreased overall, by including more than half in Colombia, the Slovak Republic and Norway. However, there are exceptions: Saudi Arabia and the Netherlands recorded an increase in TEA over the past two years, which may be due to significant government support for new businesses. The level of activity of established business owners, those who have owned and operated a business for more than 42 months, has also generally decreased.
In Russia, the TEM index was 8.3% in 2021; it remained almost unchanged compared to 2020 (8.5%), but fell down compared to the figure for 2019, which was a record for Russia over the entire period of observation (9.3%). The activity level of established business owners was about 3.4%, which is lower than in 2019-20 by 25%.
In 2021, respondents rated how often they use digital technologies to sell their products. Entrepreneurs starting a new business are more willing to use digital technologies than owners of existing businesses, who need more reasons to invest in the development of such technologies. One in three early-stage entrepreneurs and one in five established business owners in Russia indicated that they plan to sell their products and services digitally more frequently over the next six months.
The results of the study show a growing involvement in solving social and environmental problems. More than half of entrepreneurs assessed the social impact of starting a business in all countries except Poland and Norway. In Russia, 65% of entrepreneurs, when making decisions about the future of their business, take into account such social aspects as access to education, healthcare, safety, favorable working conditions, housing, transport, quality of life. The impact on the environment is also increasingly taken into account by entrepreneurs starting a business in all countries except Poland and Kazakhstan. In Russia, 70% of entrepreneurs largely take into account such environmental aspects as the preservation of green spaces, the reduction of emissions of pollutants and toxic gases, separate waste collection, and conscious consumption of water, electricity and fuel.
Despite the pandemic, in most countries, the number of entrepreneurs who have created a business has exceeded the number of those who have stopped running the business. The exceptions are Poland, Egypt and Oman. The pandemic has been the leading cause of business closures in 12 countries. In 11 countries, a quarter of respondents closed a business because they received a job offer in another business. All these countries are economically developed.
In Russia, the business exit rate was about 1%, which means that the number of those who made efforts to create a business during the pandemic turned out to be more than those who ceased to be an entrepreneur. 18% of those who closed their business indicated the consequences of the pandemic as the main reason, in 2020 there were 29% of them. This may indicate a better adaptation of the business to the second wave of the coronavirus.
Global Entrepreneurship Monitor was founded in 1999 as a joint project of Babson College, USA and London Business School, UK. Today it is an association of universities, business schools and research centers around the world to collect and share information about entrepreneurial activity. GEM is the most influential research project on the phenomenon of entrepreneurship and its cross-national indicators.