Pôle emploi first “business angel” in France? So much the better!

In France, 94.3% of the companies created have no employees and 40% of their founders are unemployed or underemployed. Many of the latter have benefited from financial support from Pôle Emploi, in particular through the support for business creators and buyers (ACRE). So much so that the public establishment is considered the first business angel of France! The institution accepts it and even claims it on its website. Thus, in 2015, 77.9% of jobseekers who set up a business benefited from a tax exemption, and 54% of them received allowances.

employment center

These figures testify to the success of the incentive approach to return to work by making an impact with financial aid and support.

“Entrepreneurial Illusion”?

Positively presented by the editors, the same figures nevertheless give an ambivalent interpretation. Admittedly, each business generates 1.8 jobs over three years, but that ignores the fact that 89% of businesses created do not generate a job, or possibly only one: the creator’s. After three years of activity, 76% of the companies created in 2015 are still active, but for an income that does not allow them to live decently: almost 25% of the creators get only a monthly income from their activity. less than 500 euros per month!

This second reading of the results certainly invites us to question the targeting of the support, but also to reflect on the meaning of such actions.

Because Pôle emploi here seems to nurture what Scott Shane, one of the decade’s most influential researchers in entrepreneurship, describes as the “entrepreneurial illusion”: letting everyone become an entrepreneur, as if this status guaranteed a decent standard of living , even very comfortable. However, this is far from always the case…

Pôle emploi grants can help an independent entrepreneur prepare.

Without being ultra-liberal, Shane, who has followed the American federal state in the construction of its entrepreneurial policy, assesses, in the name of the general interest, the entrepreneurial spirit of the “self-employed” (“independent workers”). not must not be subsidized: according to the American researcher, it serves neither the country’s economic recovery through consumption, since the income generated is very low, nor job creation. Entrepreneurship would contribute to the pursuit of a personal goal more than a societal one. Without being a Keynesian, Shane, who relies on the work done in entrepreneurship for almost 40 years, recommends grants for projects with potential: those based on the exploitation of an innovative idea, but in a sector with strong growth. These are therefore projects whose economic model generates job creation for the unemployed who do not necessarily have an entrepreneurial spirit or have not yet found their own project.

However, a closer reading of the situation provides a more nuanced vision and highlights the benefits of these subsidies.

The context has changed

In fact, subsidizing only projects with innovation potential is tantamount to supporting entrepreneurship in the areas where there are growing activities, where technical and technological experiments are easy. In other words, in the rich regions, in what Michael Porter, professor of strategy at Harvard, calls “clusters of innovation”.

However, examples of reintegration through self-creation of one’s job in disadvantaged areas are legion: In addition to the criticism that can be directed at them, the large so-called platform companies (Uber, Deliveroo, etc.) offer e.g. for certain inhabitants of economically poor areas (e.g. Seine-Saint-Denis department) business opportunities (driver, delivery person), and Pôle emploi grants can enable the purchase of a car or the necessary equipment to get started.

The vast majority of unemployed people who have started their activity rate their experience positively.
Employment Center.

Another nuance to Shane’s arguments lies in the study of the mechanisms of job creation, of which large corporations are traditionally (and all too often) seen as being the main driver. However, the context has changed and the situation is more complex, especially due to the trend towards outsourcing of certain activities, especially in services: IT, maintenance, cleaning, design, communication, etc. It is therefore a question of supporting this increased demand after services provided by the self-employed.

Maintaining employability

A third nuance to bring to Scott Shane’s reasoning could be the pedagogical virtue for the individual undertaking the entrepreneurial project: how do you find customers? How do you negotiate? How to manage? So many elements that, even if success is not in the meeting, constitute learning and can help him come back later.

These experiences would even benefit those around him. All research on entrepreneurial intention shows that the more the individual is surrounded by entrepreneurs, the more he will be inclined to create his business and maximize its chances of success. In this perspective, support will have effects far beyond the sole entrepreneur.

Finally, the last argument in favor of self-employment: maintaining an identity, a qualification and even the meaning of work. So many advantages that prevent the unemployed from seeing their employability deteriorate in the labor market.

All these arguments are probably also not independent of one of the most striking figures of the Pôle Emploi survey: more than 90% of unemployed creators rate their experience as an entrepreneur in general positive!

All in all, without neglecting the risks and difficulties faced by unemployed job creators, it is therefore an advantage for the Pôle emploi to fulfill this role of business angel.

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