Sweden is granting its citizens the right to 6 months, leave of absence with this unique system that helps workers start a business when they want to promote entrepreneurship.
Sweden, with a population of just 10 million, has developed a reputation as one of the most innovative countries in Europe in recent years. The most commonly cited reasons its start-up scene has grown so quickly include strong digital infrastructure, a culture of collaboration and affordable private unemployment insurance, which provides a larger social safety net than in many countries.
Securing Entrepreneur Stability
To become an entrepreneur, we found that while financial risk was the top concern, career risk came a close second.
Most employees hesitate to leave a job that they perceive as secure for something as insecure as starting a business. One can take up entrepreneurship if it might become less insecure. Increasing the right to unpaid leave could play a crucial role in fueling entrepreneurship, even in countries with much more flexible labor markets.
Are Swedes Taking up Entrepreneurship?
Measuring exactly how much the right to unpaid leave has contributed to starting a business is tricky. While the trend, particularly in the tech scene has been observed by academics, unions and employers alike. There are no national databases that break down how many people registered to take a leave of absence start a business. But what the figures confirm is that rising demand for all kinds of leaves of absence (including paid parental leave) coincides with growing numbers of Swedes starting their own companies.
In 2017, 175,000 25- to 54-year-olds on leave were registered, compared to 163,000 in 2007, according to Statistics Sweden. The registration office for Swedish companies, Bolagsverket, says 48,542 limited companies registered in 2017, up from 27,994 in 2007.
Drawback for Entrepreneurs
For the employer, it means losing someone who knows the job. Especially in situations where there is a lack of skilled workers in a field, this of course can be problematic. But again, when they return to your company, they are now more educated and experienced about the market out there.
The entrepreneur can also deny the right to unpaid leave when the employee is starting a business; Which will become a direct competitor. They can also deny when the job is a crucial operation that they can’t manage without a staff member which has to be carried out in the company.
For More Insights Read this Report from BBC at Sweden’s surprising rule for time off.
Right Now, I can feel a lot of want to be entrepreneurs from the rest of the world, Wish! for a system like Sweden’s unpaid leave system to start the business. For those of you Swedes, what more are you waiting for to become an entrepreneur.
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