What Michael Dell and the United Nations think is critical for creating jobs

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NEW YORK, NY - MARCH 08: A general view of The United Nations Headquarters on March 8, 2012 in New York City. (Photo by Dario Cantatore/Getty Images)
Photo by Dario Cantatore—Getty Images

It’s not everyday that drug-sniffing dogs and security guards snoop around a San Francisco tech office. But it’s not everyday that United Nations Secretary-General Ban Ki-moon and Dell CEO Michael Dell stop by for a town hall meeting about entrepreneurship.

The event, which also included an appearance by House Minority Leader Nancy Pelosi, was held Friday at a start-up incubator to promote the idea that governments and businesses should work together to ensure that entrepreneurs get the resources and support they need to create businesses.

Last year, the United Nations Foundation, the U.N.’s charity arm, chose Dell, founder of the namesake tech giant, to be its global advocate for entrepreneurship. In this role, Dell has been busy promoting what he feels are the necessary skills of a good entrepreneur including risk taking and individualism. He acknowledged those qualities are more difficult to channel in certain countries outside the United States. But he said those skills are necessary to create the 600 million jobs by 2025 that will be needed to accommodate the growing workforce.

Dell pointed out that “70 to 90% of new jobs in the world are not created by big companies.” Job creation is fueled mostly by newly formed small businesses, the kinds similar to San Francisco startups, he argued.

Ban agreed with Dell, saying “Tech entrepreneurs have an extraordinary opportunity to contribute with these efforts.”

The audience of CEOs and company founders dressed mostly in suits and ties rather than the Silicon Valley’s more casual uniform of jeans and hoodies, occasionally clapped and nodded in agreement.

No one at the event mentioned the fact that the entrepreneurs that helm innovative startups often face difficult challenges dealing with employees as they grow to the size of a company like Dell. Dell, for example, has laid off thousands of employees as part of the company’s restructuring plans. The same is true for Hewlett-Packard (HPQ), which is trying to eliminate around 55,000 jobs to make for a leaner operation.

Indeed, one of the startups praised at the event and a one-time resident of the RocketSpace facility is at the center of its own labor controversy: Uber, the popular ride-hailing service. It has been criticized for using contractors, not employees, as drivers. In a recent ruling, the California labor commission disagreed with the way it classified one of its contractor drivers and should reimburse her for driving expenses. It served to further fuel the debate about Uber’s business practices and highlighted the minefield startups must navigate when bulking up their workforces.

It’s great that Dell is trying to lift people from poverty through his work with the United Nations. But when the small young businesses he is targeting grow up, they should also take care of their employees and ensure that they are able to keep their jobs.

The balance between being a profitable company beholden to shareholders and being a corporate do-gooder that provides people with jobs becomes more tricky to pull off. While a large percentage of new jobs in the world may be created with new businesses, it’s often that the older businesses are the ones doing the massive job cutting.

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