Variables - Race and gender affect activity
Entrepreneurial activity in SA varies according to age, gender, race, location and education.
The most active group in SA is white males between the ages 35 and 54, who have received tertiary education and live in metropolitan areas. On the age dimension, levels of entrepreneurial activity are highest among the 35-54 age groups for both men and women. But entrepreneurial activity in SA is nearly twice as high for men as for women. This gender difference is in line with the average for most of the Global Entrepreneurship Monitor (GEM) countries. The exceptions are Italy, Spain and New Zealand, where the level of participation in entrepreneurial ventures by men and women is about the same.
In terms of race, the rate of entrepreneurial activity is more than double among whites (10,1%) and Indians (10,3%) than blacks (4,6%).
Location differences are even more striking than gender- and race-based differences. In metropolitan areas, nearly 10% of adults are engaged in entrepreneurial activity, compared with less than 2% in rural areas.
Higher levels of education are associated with significantly higher levels of entrepreneurial activity. South Africans with a matric and those with tertiary education are more likely to own and manage a start-up than those without a matric. Tertiary education also increases the perception of one's ability to be an entrepreneur. Adults with tertiary education are more than twice as likely to believe that they have the knowledge, skills and experience to start a business, than those without a matric.
Tertiary education also significantly increases the probability that a person will be an owner-manager of a new firm that survives beyond the start-up phase.
SA entrepreneurs generally prefer to start businesses on their own. Just more than 61% of entrepreneurs are sole owner-managers, 23% have only one partner and the remaining 16% are part of teams of more than two people. This pattern is consistent across race, gender, location and education lines.
Start-up and new-firm activity in SA is concentrated in particular sectors. The retail, hotel and restaurant businesses dominate, followed by manufacturing, consumer services and business services.
The proportion of entrepreneurs in the retail, hotel and restaurant sector was highest among black adults, women, and those without a matric. This category includes businesses such as spaza shops and shebeens. The pattern for business services was the reverse, with concentrations of white and Indian men, and those with tertiary education. The proportion of entrepreneurs in wholesale and related businesses was higher for Indian adults.
