Small Business Training and Loans for Aspiring Entrepreneurs in Disadvantaged Neighborhoods in FrancePDF version
Unemployment contributes to property crimes, violent crimes and national dissatisfaction, particularly when youth unemployment is high. Governments will therefore seek ways to reduce unnecessary unemployment and promote youth employment, particularly in disadvantaged areas. If existing businesses are unwilling or unable to hire new employees, then entrepreneurship may be one potential solution to unemployment, but there is little evidence on the efficacy of projects which aim to overcome the obstacles to starting a business.
Chronic unemployment is a considerable problem in France, particularly in the poor neighborhoods that ring French cities from Paris to Marseille. Across 750 so-called "Sensitive Urban Zones", 36.2 percent of men and 40.8 precent of women aged 15-24 years are unemployed.1 French companies are reluctant to hire young employees, forcing many individuals to seek internships well into their thirties. While self-employment is a positive alternative, entrepreneurship is low in France: at the end of the 1990s, only 2 million people were independently engaged in an enterprise.2
Young people are often poorly informed about the kind of aid that exists to support entrepreneurship, and are often overwhelmed by the necessary steps to create their business. In addition, even when certain young people have the desire to start a business, they often lack the training and experience to put their ideas into practice. Lastly, they often lack the necessary capital to start a new business. These impediments are especially acute in disadvantaged neighborhoods in France, where youth unemployment is more prevalent.
The program CréaJeunes, created by Adie (Association pour le droit à l’initiative économique)—an NGO that aids people in creating their own business—is directed at supporting business creation for young people between ages 18 and 30, from disadvantaged neighborhoods. In total, it is expected that 2,200 young people (1,100 treatment and 1,100 comparison) will be involved in the study.
During the first phase (four months), CréaJeunes provides specific support including both individual and group coaching, individual follow-up, an immersion experience in a firm and job training. CréaJeunes will reimburse some of the fees linked to the preparation of the business project and will potentially offer grants and/or microcredit loans at specific amounts. The program will provide additional support for approximately 18 months following business creation.
Results forthcoming.
1 EUbusiness, “Youth Unemployment in France: the figures”, http://www.eubusiness.com/Employment/060403154452.c0egg72s/.
2 Gaebler Ventures, “Global Entrepreneurship – French Entrepreneurs.”
