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Entrepreneurship is booming in the U.S. Gen Zers are leading the way.

From CBS News · () English

Summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • Generation Z is disproportionately contributing to a surge in U.S. business formations, with new business applications from Gen Zers jumping 66% year-over-year.
  • This trend is fueled by a growing preference among young people to become their own bosses rather than work for others.
  • Artificial intelligence is also lowering barriers to entry, making it easier and cheaper for young entrepreneurs to start companies.

Entrepreneurship is experiencing a significant boom in the United States, with Generation Z leading the charge. Melanie Herbert, founder of health tech startup Sync Labs, exemplifies this trend. Her company aims to improve care for older Americans, a venture inspired by her own experiences with healthcare providers. "I feel like it's unfortunately a very neglected space where a lot of the technology and tools are really behind," Herbert, 23, told CBS News.

I feel like it's unfortunately a very neglected space where a lot of the technology and tools are really behind.

— Melanie HerbertHerbert, founder of Sync Labs, describes the state of healthcare technology for older Americans.

Research from the Bank of America Institute reveals that Gen Z members are contributing "disproportionately" to this surge. Their new business applications increased by 66% in June compared to the previous year, far outpacing other generations. This rise in entrepreneurship among young Americans is fueling a broader increase in business applications nationwide, with over 531,000 filed in June, more than double the 2020 figure.

Scott Issen, CEO of nonprofit Future Founders, attributes this shift to a changing attitude toward employment. "Macroeconomically, I think there's less interest year over year for young people to work for others," he said. "They would prefer to be their own bosses and create their own opportunity." The trend is also democratizing entrepreneurship, with lower-income households now accounting for 25% of new businesses, up from 20% in 2020, according to the Bank of America Institute.

Macroeconomically, I think there's less interest year over year for young people to work for others. They would prefer to be their own bosses and create their own opportunity.

— Scott IssenIssen, CEO of Future Founders, explains the shift in young people's career aspirations.

Experts also point to the role of artificial intelligence in lowering barriers to entry. AI tools automate basic tasks and reduce startup costs, making it easier for young individuals to launch their ventures. "The barriers to entry are getting much lower," noted Lori Rosenkopf, a professor at the Wharton School. "It's pretty easy for anyone to start building some content, making themselves..."

The barriers to entry are getting much lower. It's pretty easy for anyone to start building some content, making themselves...

— Lori RosenkopfRosenkopf, a professor at the Wharton School, discusses the impact of AI on entrepreneurship.
DistantNews Editorial

Originally published by CBS News. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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