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The call to extend the term “entrepreneurship” within Indonesia’s context is urgently needed.

As the government is pushing the agenda to equip youth with entrepreneurship skills to tackle unemployment, many universities in Indonesia are starting to implement entrepreneurship education programs for their students. So what kind of entrepreneurship education is delivered to our youth in university?

Based on the Indonesian Millennials Report 2019, 63.9 million people in Indonesia are aged 20 to 35. These are the ages of recent graduates, job seekers and people early in their career. Youth unemployment in Indonesia based on the data from the International Labor Organization in 2016 was 17.8 percent. These numbers are alarming, particularly in light of the “demographic bonus” expected by 2030. Therefore, the government is relying on entrepreneurship initiatives as a silver bullet to tackle these issues.

These initiatives include stimulation programs by the Research, Technology and Higher Education Ministry such as the Indonesian Student Entrepreneurship Program that can supplement entrepreneurship training, if any. The programs are business plan workshops and competitions. However, the effectiveness is questionable as the readiness in terms of competencies and capabilities of universities to deliver these initiatives still varies highly.

Furthermore, the national system of entrepreneurship is still absent, including the definition, regulation and practical aspects. This has resulted in Indonesian’s adopting a narrow understanding of entrepreneurship, limited to venture creation, micro, small, medium enterprises, self-employment and trade.

Meanwhile in the United Kingdom, the Quality Assurance Agency (QAA), a body that governs higher education practices, has published a guidebook to inform entrepreneurship education delivery in higher education institutions. First published in 2012 and then updated in 2018, it gives clear guidance on what entrepreneurship education entails and how higher education should embrace it.

The QAA uses the term enterprise in conjunction with entrepreneurship and defines it broadly to combine creativity, originality, initiative, idea generation, design thinking, adaptability and reflexivity with problem identification, problem solving, innovation, expression, communication and practical action.

Entrepreneurship education is then defined as the application of enterprise behaviors, attributes and competencies into the creation of cultural, social or economic value. This can, but does not exclusively, lead to venture creation.

However, based on a recent research done in a private university in Indonesia, entrepreneurship education is delivered exclusively to training in business planning geared to venture creation. The expected result is students that have been equipped with entrepreneurship training will start their own business soon after they graduate. This then results in sociology majors setting up food stalls selling fried chicken, and engineering students selling T-shirts.

Young graduates starting their business with limited experience, lack of funding and minimum support will resort to microbusinesses with no guarantee of growth and scaling up. It’s not bad thing but on a macro and long-term level, this could be alarming. If this continues, Indonesia might be stuck in the middle-income trap, and slowly deteriorating to economic downfall.

Consumerism is favored instead of production. Products will have shorter market life span and businesses will fail faster because of high competition driven by recycling ideas based on trends and not disruptive innovation.

Due to the failure to scale up, microbusinesses will not be able to afford to employ people and thus the intended outcome of entrepreneurship as a solution to unemployment remains farfetched. Entrepreneurship will only result in economic and social development only if it is driven by innovation. Innovation should be fostered and facilitated in universities.

The role of universities is now questioned; why do these students need to pay so much money, some travel a long way from home, study a scientific discipline for three to four years and yet graduate to find themselves reluctantly pushed into self-employment trading goods and services that might be undervalued? Where is the creation of new knowledge? What about the university’s role in facilitating disruptive innovation? Where does university research spill over to?

Higher education is still considered a privilege in Indonesia — only 9 percent of youths hold a university degree. Therefore this small number of graduates should be placed strategically within the national development agenda, especially if Indonesia is targeted to become a top four economy in the world by 2045.

However, many government initiatives in entrepreneurship assume that Indonesians youth are reluctant to become entrepreneurs. A recent research by the Global Entrepreneurship Monitor in 2015 and a case study I made at a private university in Jakarta concluded Indonesian youths are actually highly aware and have a positive attitude to entrepreneurship. What is needed now is pointing them in the right direction. Thus, universities along with the government should then ask — what kind of entrepreneurs do they want in this country?

As we are gearing to a knowledge-based economy, universities should take the lead in forming innovative entrepreneurship ecosystems. Entrepreneurship related to students and university graduates should result from the knowledge spillover from university research informed by real world problems from industry, which will create innovative solutions or even new forms of industry through market disruption. Universities should not be limited to pushing their graduates to become entrepreneurs driven only by necessity and motivated by profit.

The triple helix of universities, government and industry must act fast to drive entrepreneurship initiatives to become innovation driven, instead of necessity-driven. Universities should take entrepreneurship education programs more seriously, and more importantly strategically place entrepreneurship as the motor of their overall curriculum.

This means entrepreneurship education should focus more on equipping youth with thinking skills such as creativity, problem solving, critical-thinking and opportunity recognition along with transferable skills such as leadership, teamwork, change management, communication and negotiation. These are the foundation of any successful entrepreneurial journey — and universities have the most power to supply these into student’s capabilities. Therefore, entrepreneurship education in Indonesia needs to equip students with entrepreneurial skills to foster innovation.

Only with this concept, entrepreneurship education can holistically drive a knowledge-based economy for a better Indonesia.

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The writer is a doctoral researcher focusing on entrepreneurship at the Warwick Manufacturing Group, University of Warwick, United Kingdom.

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