Research Concludes Older Entrepreneurs Prioritize Quality of Life over Financial Gain
Traditionally, young men have led the way when it comes to new small business start-ups, but new research from Syracuse University’s Martin J. Whitman School of Management suggests an increase in entrepreneurship among those at or nearing retirement age. In “Late-career entrepreneurship, income and quality of life,” Maria Minniti, Bantle Chair in Entrepreneurship and Public Policy, and her co-authors, Teemu Kautonen (Aalto University, Finland) and Ewald Kibler (Aalto University, Finland), find that despite the fact that it may not be financially lucrative, people in late stages of their careers are leaving their high-paying, established jobs and starting their own businesses.
“This surprised us,” said Professor Minniti. “We assumed that those people who were well-employed would remain so until they retired but that’s not what we found. They were making the spontaneous, often risky, choice to leave their careers and start their own companies, even if it meant losing money.”
The study used data from the English Longitudinal Study on Ageing, a long-term collaborative research effort coordinated by University College London, and funded by the National Institute on Aging and the government of the United Kingdom, however Professor Minniti believes the findings are applicable to the United States, as well, where the so-called “Baby Boomer” generation, which includes 76 million people (AARP), is at or nearing retirement age.
“Our findings show that people who are employed full-time in stable positions with good salaries are willing to give that up in exchange for a higher quality of life,” said Professor Minniti. “We live longer and, therefore, have more time to do the things we love. It turns out for many, the things they love are not limited to golf and bridge!”
Professor Minniti said these results are significant in terms of the economic and social impact late-life entrepreneurs have. For example, when people are more active, it’s good for them and for society. What’s more, in countries where it’s challenging to provide benefits for the high population of elderly, this phenomenon would help. Entrepreneurs would be self-sufficient and in many cases insured, reducing their burden.
The study is forthcoming in the Journal of Business Venturing.