When studying entrepreneurship, much of the academic effort is devoted to trying to determine the traits that distinguish entrepreneurs. However, the fact that an individual has these traits is not synonymous with him or her being willing to start an entrepreneurial activity. What is truly significant is the influence that entrepreneurial traits can have on the effective configuration of the individual’s entrepreneurial intention .

Age and entrepreneurial potential

The concept of entrepreneurial potential refers to a person’s propensity to perceive opportunities and act, to create value by forming new businesses, and to respond to uncertainty with innovation.

More broadly, it refers to the individual’s freedom to change, grow, develop and adapt to market contingencies and opportunities. Entrepreneurial potential is more about the likelihood of entrepreneurship that derives from a given personality than about entrepreneurship itself.

This entrepreneurial potential is part of a complex reality in which the aptitudes and dispositions of individuals, certain economic and social contexts and situations, and the ability to manage the risks associated with the creation and growth of a new business converge.

One of the most interesting aspects of entrepreneurial potential is that it can vary significantly depending on the generation to which an individual belongs , since each generation is influenced by different historical, economic and cultural contexts, which affect attitudes towards entrepreneurship.

Age in the workplace

The work environment – ​​how people interact in intergenerational work teams – can also be influenced by the generation they belong to. Many studies claim that employees prefer to work with people of their own age and that generational diversity can be problematic. However, other research suggests that generational diversity is highly valued, especially in leadership teams, and is considered as important as other types of diversity (religious, gender, cultural, racial and ethnic, among others) in terms of impact on job performance.

Generational differences in work teams can create tensions in areas such as knowledge transfer, work expectations and communication between workers. Therefore, to obtain the best possible results in intergenerational work teams, a good organizational strategy is necessary, which facilitates knowledge transfer and training in generational diversity.

Baby boomers

Baby boomers – children of the silent generation (1928-1945) and born between 1946 and 1964 – grew up in a period of economic prosperity and hierarchical structures, so they tend to value stability and job security.

As they are increasingly less present in the labour market, their entrepreneurial potential has not been studied as much as, for example, the characteristics of their entrepreneurship. There are studies that claim that members of this generation tend to be persistent and resilient , value hard work and loyalty, have high levels of confidence and a marked need for success.

X, Y and Z, entrepreneurs and workers

Generation Xers (1965 to 1980) grew up during times of economic and technological change , which has made them adaptable and open to innovation. They are seen to have a pragmatic approach to work and to be good resource managers. In the entrepreneurial context, they tend to show moderate entrepreneurial potential and value both security and autonomy in their careers .

Ys, or millennials (born between 1981 and 1996), are known for their familiarity with digital technology and their desire for flexibility and purpose in their work . They tend to have high entrepreneurial potential due to their desire to challenge the status quo , their willingness to take risks, and their inclination toward change. They value independence and are more willing to leave traditional jobs to start their own businesses, seeking a work-life balance.

Members of Generation Z (born 1997 or later) have grown up entirely in the digital age , giving them natural skills in technology and social media. However, their entrepreneurial potential may be lower than that of previous generations. Why?

The evil of generation Z

Typically, a generation is shaped by a series of political, socioeconomic and cultural events . For Millennials, Generation Z shares much of the context of globalisation, digitalisation and social and cultural change with Generation Y. However, Generation Z – the latest to enter the workforce – has, by comparison, lower average scores on factors such as communication skills, confidence, need for success and internal control. All of this translates into lower entrepreneurial potential .

If the lack of confidence and the lack of interest in taking responsibility can be explained by their youth, the poor communication skills of Generation Z could be influenced by the fact that they are digital natives . As they mature and gain more experience, these factors are likely to evolve, and research will have to take note of this.

And, the most entrepreneurial generation

Finally, it seems that millennials, or generation Y, are the generation with the greatest entrepreneurial potential. Members of this generation have been showing a significant inclination towards entrepreneurship, are familiar with new technologies and tend to start businesses at an earlier age than previous generations.

They have leadership skills, focus and ambitions, which, compared to other generations, predisposes them to leave stable jobs to pursue entrepreneurial opportunities .

Author Bio: Javier Bouzas Arufe is Professor, Entrepreneur and Researcher in economics and business at the University of Santiago de Compostela