Application of principal component analysis on perceived barriers to youth entrepreneurship

Abstract

Entrepreneurship is an imperative driving force for innovation in a country. Nevertheless, there is lack of systematic investigation in the area of barriers to entrepreneurship and its effects on the intentions of the youth becoming an entrepreneur. As a result, the primary objective of the study is to analyze perceived barriers to youth entrepreneurship. The study used responses from 186 students of a tertiary institution, who were selected based on convenience sampling method. A 5 point likert scale was used to measure the responses and the data analyzed with descriptive statistics, correlation and principal component analysis. The results indicate that youth perceive lack of capital, lack of skill, lack of support, lack of market opportunities and risk as the main barriers to youth entrepreneurship. Nine (9) factors with Eigenvalues greater than one accounted for 73.35% of the variance explained. The study recommends that, stakeholders precautiously design courses and policies to minimize the perception of entrepreneurship barriers and maximize motivational factors. Entrepreneurship education be designed to enhance skills and knowledge in entrepreneurship and also to reorient students’ career choices towards entrepreneurship. Awareness campaign of government support instruments should be done. Policy makers should implement sound economic policies to boost the country’s economic environment.