Entrepreneurship in Nebraska: Findings From a Gallup Survey

THE GALLUP ORGANIZATION

William WalstadUniversity of Nebraska-Lincoln

Entrepreneurship in Nebraska:Findings From a Gallup Survey

2Copyright © 2006 William Walstad

Credits

• The Gallup Organization

• Krieger Family Foundation

• Jim Krieger & Glenn Phelps for leadership

• Walstad & Kourilsky studies for most survey items


Sampling• General Public

2,460 Nebraskans 18 years of age or older

+/- 2% sampling error for state results

• Business Owners

555 Nebraska business owners with 1 to 100 employees

+/- 4.2% sampling error for state results

Survey conducted: Fall 2005


Survey Topics

1. Interest in Entrepreneurship (5)*

2. Views of Small Business (3)

3. Reasons to Start a Business (4)

4. Challenges and Obstacles (2)

5. Entrepreneurial Knowledge (4)

6. Preparation and Education (5)

7. Role of Government (4)

8. Economic Development (4)

*Number of items on topic


Interest in Entrepreneurship


Want to Start Own Business

40%

9%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Yes Already own business

Total interest in entrepreneurship = 49%

General Public (n = 2,460)


Want to Start Own Business by Age

69%

55%

43%

17%

3%8%

13% 11%

0%

10%

20%

30%

40%

50%

60%

70%

80%

18-29 30-39 40-49 50+

Yes Already own business

Age

General Public (n = 2,460)


Age When Thought of Starting Own Business

67%

20%

10% 7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

5-29 years old 30-39 40-49 50+

Business Owners (n=555)


Number of Other Businesses Started

33%29%

22%

16%

0%

5%

10%

15%

20%

25%

30%

35%

None other thanthis one

1 2 3 or more



Interest Findings

• Entrepreneurial interest is great. The pool of potential entrepreneurs is an untapped resource for Nebraska.

• Entrepreneurship begins early. Most of the general public business owners start thinking about it at a young age.

• Entrepreneurship is multiple process. Starting one business often leads to starting others.

• Entrepreneurship is viewed as a good career choice.


Economic Development


Years to Exit Business

28%

21%

11%

25%

0%

5%

10%

15%

20%

25%

30%

0-5 years 6-10 11-15 +15 Years



Who to Transfer Business to

36%

11%

18%

27%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Family Employee(s) Third party Liquidate



Development Findings

• There is a transition problem for business. Most owners plan to exit the business in ten years. Many owners plan to liquidate their business.

• Nebraskans generally give low ratings to the effectiveness of economic development in their communities.


Role of Government


Challenges to Starting a Business

61%

62%

69%

79%

0% 20% 40% 60% 80% 100%

Competing withother businesses

Get loans/finance

Developing sales

Government redtape & regulation

BusinessOwners(n=555)


Government Regulation of Business

21%

5%

73%

27%

8%

61%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Right Amount

Too little

Too much

General Public (n=2,460)



Business Taxes

42%

15%

37%

64%

7%

26%

0%

10%

20%

30%

40%

50%

60%

70%

Overtaxed Undertaxed Right Amount

General Public (n=2,460) Business Owners (n=555)


Government Findings

• Business owners, more so than the general public, think there is too much government regulation and taxes.

• Both business owners and the general public think government should provide more tax incentives for people to start new businesses.


Reasons to Start a Business


Major Reasons to Start a Business

6%

8%

9%

13%

50%

18%

13%

6%

7%

46%

0% 10% 20% 30% 40% 50% 60%

To earn lots of money

To use skills

Help community

For the family

To be my own boss

General Public (n=1,208)*


*Yes to entrepreneurship


Major Reasons Not to Start a Business

6%

8%

24%

39%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

It is too risky

No money

Lack skills, ideas, etc

Age


“No” to entrepreneurship


Reasons Findings

• The prime reason people become entrepreneurs is the need for independence, and not to make lots of money.

• After age, the prime reason people do not become entrepreneurs is they lack something, which in many cases can be changed with more education and preparation.


Preparation and Education


Importance for Starting a Business

28

35

38

20

21

20

0 10 20 30 40 50 60 70

College

High School

Work Experience

Very Important Important


Numbers shown in percentages


Importance of High School Factors for Starting a Business


21

24

19

20

0 5 10 15 20 25 30 35 40 45 50

Business &Entrepreneurship

Classes

A key teacher orteachers



Importance of College Factors For Starting a Business

19

21

20

35

0 10 20 30 40 50 60

A key professor orprofessors

Classes that taughtbusiness or

entrepreneurship




Education Findings

• Work experience and education are prime factors for preparing people for entrepreneurship.

• Education, both in high school and college, are important factors for to entrepreneurship.

• The general public strong support more entrepreneurship education in the schools.


Views of Small Business


Contribution Business Owners Make to the Community

9%

80%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Philanthropic

Economic



Importance of Business Owners Contributing to a Community

29%

54%

0%

10%

20%

30%

40%

50%

60%

Important Very Important



Views Findings

• Nebraskans have a positive opinion of small business: its economic opportunities, services, and philanthrophy.

• Nebraskans think it is important for successful business owners to contribute more to a community than just jobs or taxes.


Conclusion

• There is great potential for expansion of entrepreneurship in Nebraska, especially among young adults.

• The state needs to find creative ways to tap that potential through education, incentives, and community support.

• Nebraska will benefit from the multiple contributions entrepreneurship makes to economic growth, jobs creation, and philanthropy.

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Entrepreneurship in Nebraska: Findings From a Gallup Survey

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