Constraints of youth entrepreneurs in Ethiopia

Abstract

The youth entrepreneurship has been regarded as a tool for employment creation in Ethiopia. However, the country faces the challenge of high youth unemployment rates. Even the country is considered as one of the lowest rates of youth entrepreneurial activity and business operating in the sub-Saharan African region. The aim of this research is to investigate the major potential constraints of youth entrepreneurs in the small and micro-enterprises. In order to fulfill the objectives of the study, this research employed a descriptive research design with a quantitative research approach. The target population of the study was 5000 youth entrepreneurs between aged 18 and 29 years at the time of the research. Out of the target population, the researchers selected 370 as a sample size by using a proportional stratified sampling technique. The valid responses for analysis were 350 respondents. The survey questionnaire was used as a tool for data collection. The study used descriptive statistics and factor analysis. The results of the study indicate that unfavorable government policy, limited access to finance, limited access to market, limited access to information and infrastructure, limited access to business assistance and support, limited access to entrepreneurship training and education, lack of social support, unfavorable administrative, and weak institutional linkage were the major potential constraints of youth entrepreneurs in the study area. The study draws implications for policymakers, the Ministry of Youth Development, Chamber of Commerce and Industry, and the government to adopt multi-faceted, multi-targeted, and multitier approaches in order to facilitate and encourage youth entrepreneurship.