How many people under 30 are choosing not to pursue a traditional career path i.e. going into a startup or become a digital nomad instead?

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How many people under 30 are choosing not to pursue a traditional career path i.e. going into a startup or become a digital nomad instead?

Hi there, thanks for asking Wonder about how many people under 30, especially in the US and the UK, are choosing not to pursue a traditional career path.
The short answer is that the global number of the workforce under 30 who are not pursuing traditional career paths are 157.7 million. In the US, there are 19.7 million of those in the workforce under 30 years old not pursuing traditional career paths, and in the UK, there are 515.5K. These numbers can be categorized into freelancers, small business owners, and startup owners below 30 years old, as follows:
— Freelancers in the US and UK are 16.4 million and 212K, respectively;
-Small business owners in the US and UK are 2.6 million and 260.5K, respectively;
-Startup business owners in the US and UK are 659K and 79K, respectively.
The information above is based on our own calculations, as typical age group categories are the 18-34 of age, or 18-24 and 25 to 34 age group and Millennials are defined as between 19-35 years old.
Below is a deep dive of our findings.
METHODOLOGY
We searched for sources which would give the latest statistics.
However, some data are above 2 years old. This is especially for a breakdown of small business owners’ data and demographics, as well as the statistics of freelancers in some major cities which are dated 2013. We searched for academic databases, corporate websites, industry reports, government reports/databases, regulatory filings, trusted media sites, user forums and review sites.
The most useful sources were the studies by the US Freelancers’ Union with Upwork, a study by Babson College, and a study by Association of Independent Professionals and Self-Employed (IPSE) together with Kingston University, London.
THE USA
The total workforce of those in the millennial age group in the USA in 2015, based on US Census Bureau Data, was 75.4 million. This age group is defined as 18-34-year-olds. According to Pew Research data, total millennials in the work force is 53.5 million. This means 70.7% of millennials are in the workforce.
To determine how many are not working in the traditional career path, another study by Freelancers’ Union with Up work, surveyed more than 6,000 freelancers in the US in 2016. The survey essentially covers independent contractors, fig workers, and freelancers (all defined in the study as “freelancers”).
They found that:
-Amongst 18-21-year-olds, 47% are freelancers
-Amongst 22-34-year-olds, 43% are freelancers.
To determine how many are US freelancers, we used the US population pyramid with stratified age groups we require: 15-19-year-olds, 20-24-year-olds, 24-29-year-olds.
In total, those in the age groups of 18- 29-year-olds, are estimated to be 53.3 million in population. For a detailed breakdown of how we arrived at this calculation, please refer to this spreadsheet based on the US population pyramid.
Based on the 53.3 million US population ages between 18-29-year-olds, on average 70.7% are in the workforce. This means 37.7 million are in the workforce. Using the Freelancers’ survey results, this means:
— 18-19 year olds: 5.8 million workforce (8.2 million population x 70.7%) x 47% freelancers = 2.7 million
— 20-29 year olds: 31.9 million workforce(45.1 million population x 70.7%) x 43% freelancers = 13.71 million
A total number of freelancers in the US between 18-29 are 16.4 million.
However, the above data is not complete without taking into account small business owners and startup founders. The most recent data on the number of small business owners is dated 2013, with a total 28.8 million. Only 5.8 million have employees, and the remaining have no employees (23 million accounting for 80%).
A more recent study by Babson College built upon the above data and found that for small business owners with employees, and considered growth-oriented, only 16% are below 35 years old. The majority (51%) of small business owners re above the age of 50. This study includes startup companies, as they are also part of small businesses, as the report has highlighted.
Based on this data, 5.8 million business owners and only 16% are below 35 years old. This means there are 928K business owners age 35 and below. Drilling this down further, based on our earlier calculations, there are 21.8 million 30-34-year-olds, which represent 29% of total millennials (75.4 million).
Hence, there are 659K business owners with employees who are under 30 years old in the US (928K x 71%). Startup companies are considered under this category.
The third category are small business owners who do not have employees. This amount to 23 million owners altogether. In terms of their age breakdowns, 15.9% are below 35 years old. This means, using the distribution of those under 30 represent 71% of millennials, which is 2.6 million.
Hence, in the US, there are 19.7 million people the age of 30 not pursuing traditional career paths, with:
-Independent workers or freelancers: 16.4 million
-Small business owners with employees (including start-up companies): 659K
— Small business owners without employees: 2.6 million
THE UK
A study dated 2016 by the Association of Independent Professionals and Self-Employed (IPSE) together with Kingston University, London, found that 1.91 million freelancers in the UK. Those age under 30 (16-29) accounts for 11.1% of all freelancers, which is equal to 212K of young freelancers.
However, this study recognizes that, as at the date of their study, 2015, a total of 4.08 small businesses in the UK are without employees, of which 1.84 million are considered as ‘freelancer-owned businesses’.
In terms of UK small businesses, approximately there are 4.2 million businesses which are non-employing businesses and 1.3 million small businesses with employees.
Another UK government study found that there are 4.6 million people in the UK who are self-employed. Those between 16-29 years old account for 10.27% of total people in the UK who are self-employed, which is 472.5K of self-employed people.
Small businesses with employees are 1.3 million, with 608,110 startup business. Out of those, 8% are owners in the 18-24 age group, and 10% in the 25-34 age group. We further estimated the 25-29 age group to be 50% of the 25-34 age group, based on the UK population pyramid. The calculation is found in this spreadsheet. This means that there are 48.6 K startup owners in the 18-24 age group, and 30.4K in the 25-29 age group (at 5%), with the total of 79K startup owners who are 18-29 years old.
Hence, in the UK, there are 515.5K who are under 30 who are not pursuing a traditional career path, consisting of:
-212K are freelancers
— 260.5K are self-employed businesses with no employees (472.5K less 212K)
-79K of startup owners
THE GLOBAL SCENARIO
Globally, those age between 20-29 years old account for 16% of the global workforce population of the current 3.4 billion. Of these, currently 14% are freelancers, 12% are self-employed 3% are gig workers, which is 29% of the millennials workforce.
This amounts to 157.7 million of the global population.
THE GEOGRAPHICAL DISTRIBUTION OF THOSE NOT IN TRADITIONAL EMPLOYMENT
In the US, freelancers mainly live in suburban areas (47%), followed by urban areas (35%). The top three cities in the US are :
-Riverside (11.6%),
-Los Angeles (10.1%)
-Miami (9.3%)
In the UK, freelancers mainly live in the South East of England (other than London areas) accounting for 22.2% of freelancers, followed by South West at 11.5%, and 10.4% in Inner London.
We do not have data for the geographical distribution of the global workforce, even after searching extensively for this.
TRENDS IN EMPLOYMENT
In the UK and in the US, more and more people are expressing their unhappiness with their current employment. Some are expressing a change in career, while a majority of US millennials are gravitating towards self-employment, with as many as 67% of employed millennials want to leave work for self-employment. In the UK, the figure is lower, at approximately 47%.
CONCLUSION
In conclusion, the global number of the workforce under 30 who are not pursuing traditional career paths are 157.7 million. In the US, there are 19.7 million of those in the workforce under 30 years old not pursuing traditional career paths, and in the UK, there are 515.5K. These numbers can be categorized into freelancers, small business owners, and startup owners. These numbers can be categorized into freelancers, small business owners, and startup owners below 30 years old, as follows:
— Freelancers in the US and UK are 16.4 million and 212K, respectively;
— Small business owners in the US and UK are 2.6 million and 260.5K, respectively;
— Startup business owners in the US and UK are 659K and 79K, respectively.
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Sources
Sources