Isle entrepreneurs drive job growth

By Amy Nguyen-Chyung

Hawaii’s economy has long been powered by tourism, but recent years have reminded us of the risks of relying too heavily on any single industry. While tourism remains vital, much of the state’s recent growth has been driven by construction, healthcare, professional services and information industries. State economists have repeatedly emphasized the importance of diversification if Hawaii is to build a more resilient and prosperous future.

How do we create the next generation of economic opportunity in Hawaii?

The answer is not simply recruiting companies from elsewhere. It is investing in our people and cultivating the entrepreneurial skills, innovative thinking and problem-solving capabilities that allow residents to create new ventures, new industries and new jobs.

For decades, policymakers have often assumed that small businesses are the primary engines of job creation. But research by John Haltiwanger, Ron Jarmin and Javier Miranda found something more nuanced and important: it is not necessarily small firms that drive job growth — it is young firms. Using U.S. Census Bureau data, they found that startups and young companies account for a disproportionate share of net new job creation across the American economy. Once firm age is considered, firm size itself becomes much less important. Simply put, new businesses create jobs.

This finding has important implications for Hawaii. If young firms are the primary creators of new jobs, then entrepreneurship education is not merely an educational initiative — it is an economic development strategy. Fortunately, Hawaii is beginning to build a statewide innovation pipeline that develops these skills.

Entrepreneurship education is gaining momentum. This week, Hawaii Pacific University (HPU) and Blue Startups are partnering to host a free Entrepreneurship Bootcamp for Hawaii high school students at Aloha Tower. Participants will learn how to identify opportunities, validate ideas, engage customers, build products and websites using AI-powered tools, and pitch solutions to entrepreneurs and investors. The goal is simple: help students discover that they have the power to create something meaningful.

The bootcamp complements HPU’s new John F. Scarpa Entrepreneurial Pathway, made possible through the generosity of serial entrepreneur and philanthropist John Scarpa. The pathway includes startup and maker competitions, entrepreneur-inresidences, workshop programming, faculty innovation fellowships, founder speaker series, and multidisciplinary initiatives designed to foster entrepreneurial thinking across the university.

Equally important are efforts that build connections. New companies often emerge when talented people exchange ideas, discover common interests and identify opportunities to work together. Hawaii Tech Week, founded by Michael Bennett, a 2012 HPU graduate, has rapidly become one of the state’s most important innovation convenings.

Bringing together thousands of founders, investors, engineers, students and business leaders from Aug. 31 to Sept. 6, Hawaii Tech Week creates the relationships that allow ideas to percolate, partnerships to form, and opportunities to emerge. Its mission — to grow talent, capital and technology adoption in Hawaii — reflects exactly the kind of ecosystem thinking our state needs.

Taken together, these efforts tell an encouraging story. Across Hawaii, educators, entrepreneurs, investors, foundations, nonprofits, schools, universities and public agencies are building the foundations of an innovation economy. The challenge now is to deepen these investments and connect them more intentionally.

If young firms are the engines of job creation, then developing young innovators may be one of the most important economic development strategies Hawaii can pursue. The future we seek — a more resilient, diversified and prosperous economy — will not be created by chance. It will be built by people willing to see possibilities, solve problems, take initiative and create value for their communities.

In other words, it will be built by entrepreneurs.

And there has never been a better time for Hawaii to invest in them.

Amy Nguyen-Chyung, Ph.D., is dean of Hawaii Pacific University’s College of Business.