Unemployment rates and poverty are global challenges with difficult solutions. Building the skills necessary for self-support is paramount, especially among younger adults. As a response to this challenge, researchers (Peschmann et al., 2025) conducted a large-scale entrepreneurship training program in low-income and middle-income countries. The study found evidence of success in both the short and long term.
ENTREPRENEURSHIP TRAINING AND BUSINESS OUTCOMES
Students at several universities were recruited to participate in a 12-week training aimed at boosting entrepreneurship. Over 6,000 students signed up, and about half were randomly assigned to receive the training or serve as a control group. In the training sessions, students learned about developing business ideas, crafting marketing strategies, and managing finances. They were also placed into teams and given $100 in starting capital to facilitate hands-on learning.
Overall, participating in the training led to a 22% increase in the likelihood of being self-employed almost two years later. The training also led to increases in wage employment, total income, and hybrid employment (i.e., being both self-employed and an employee). In contrast, business performance outcomes (profits, sales, investments) dipped right after training but improved over time, showing that it can take patience for new businesses to stabilize.
PRACTICAL IMPLICATIONS
Policymakers and practitioners should consider entrepreneurship training as a practical, scalable tool to support youth employment and poverty reduction. Because visible gains take time, programs should be designed with realistic expectations and sustained support. Efforts may be best focused on helping people build modestly growing ventures rather than a few high-growth “unicorns.” Finally, new training programs should include ongoing evaluation and refinement to achieve full success.
Peschmann, J., Gielnik, M. M., Frese, M., & Bischoff, K. M. (2025). Overcoming poverty and unemployment: The transfer dynamics of entrepreneurship training. Journal of Applied Psychology. Advance online publication.
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