As of October 2016, over 20 million men and women in the EU were unemployed. Against the social scourge of mass unemployment, hegemonic neoliberal thought prescribes entrepreneurship. In an era when ideologies are supposed to be dead, neoliberalism presents entrepreneurship as the new gospel. But the gospel of entrepreneurship is not simply ideology; it is pure dogma, since its imagined miraculous effects find absolutely no correspondence in reality. As much as 90% of startups end up in bankruptcy. The few that succeed are usually dependent on big companies that swallow the bulk of the generated value, while the owners of these small startup enterprises become no more than “disguised” salaried workers (with the advantage for the bosses that they don’t have to pay social insurance, vacations, sick leave, etc.).
The gospel of entrepreneurship advises unemployed people to start their own businesses. One would think that the countries with the highest numbers of Small and Medium-sized Enterprises (SME’s) would be the ones with the lowest unemployment rates, right? Wrong. In the EU, the countries which lead in terms of proportion of SME’s – Greece, Italy, Portugal and Spain, the infamous “PIGS” – have the highest rates of unemployment. On the opposite side, European countries with lower unemployment rates have less SME’s. The EU country with the lowest number of SME’s, Germany has the second lowest unemployment rate (4,1%). The same tendency is seen in the UK, while in other European economies with low unemployment rates, such as Czech Republic or Malta, the number of SME’s is close to the European average.
While the quantity of SME’s and their share in value added have increased from 2008 to 2015 (+3,3% and +8,6% respectively) there is a negative ratio of employment in SME’s for the same period (-2,2%). This negative employment ratio is particularly visible in those countries with the highest number of SME’s, namely, the “PIGS”. Besides, the sectors of the economy which contribute the most for this negative ratio are crucial ones, such as manufacturing, construction and trade. Only the SME’s operating in the tertiary sector (services like accommodation, food, business, etc.) have had a positive ratio of employment, thus reflecting the process of deindustrialization and tertiarisation of the European economy. (Source: Annual report on European SMEs 2015-2016, European Commission)
It is clear that the relation between entrepreneurship and unemployment is not as clear-cut as neoliberal ideologists would have us think. This discourse has one main objective: to free the political establishment from any responsibility in creating jobs and promoting full employment. If people are unemployed, it’s not society’s fault. It’s people’s fault, because they refuse to act “entrepreneurially”. According to this line of thought, unemployment is ultimately an individual problem, instead of a social problem. It is a cultural flaw that should be amended, for ex., through entrepreneurship schooling for children; it is not a socioeconomic issue which has to be addressed politically. This way neoliberalism extirpates its own fault in the origin of mass unemployment, lays the responsibility on the individual’s back, and still is able to draw some Social Darwinist conclusions of the “survival-of-the-fittest” type, so current among the liberal right.
The gospel of entrepreneurship isn’t based on reason, but on faith. And, as often happens, faith serves here the purpose of mystifying reality, clearing out the elites from any responsibility for the social ills that afflict us, and depicting the unemployed population as responsible for its own misfortune.