Back Ground The unemployment rate of youth group is currently 31.46% in Addis Ababa. Moreover, it is
believed that, as the major source of social problem to youth group is “lowest economic capacity”. Objective: The main
objective of this study was to assess the relationship between microenterprises and socioeconomic development among youth
group in Addis Ababa, Ethiopia. Method: A survey based study was used to collect data on the relationship between
microenterprises and socioeconomic development among youth group in Addis Ababa, Micro and Small Enterprise Program
started before 7 years (2004) it has to be changed in to 2003G.C. This program targeted different parties of the society (MSE
2010).The total of 120 micro enterprises which operated by youth groups. The sampling method was involved in ten sub-cities
of Addis Ababa. The major micro and small enterprise activity identification was based on the available information from MSE
packages and selected randomly. Data analysis was made by using descriptive statistics. Results: The findings of this study
have vital implications to poverty reduction, employment creation, women empowerment of microenterprises, and the use of
consultancy services by microenterprises targeting youth group for the growth of their enterprises. The major constraints of the
sector, specifically, for youth target microenterprises, such as place; credit access; and misunderstanding, disagreement and
mistrust among group members has to be addressed. This could be achieved by coordination of the different stakeholders of the
sector such as Addis Ababa City Municipality, Addis Ababa MSE Agency, Addis Ababa Youth Association, Microfinance
Institutions, and NGOs. Moreover, different supports for youth group microenterprises have to be continuing and it has to be
strengthening, furthermore, such supports have to be more of growth oriented. Since, the results of the study shows that
majority of youth targeting micro enterprises are not using consultancy services, the stake holders of the sector has to provide
favorable conditions. Conclusion: Most of the respondents believed that employment in microenterprises could reduce poverty,
and leveled as high in terms of its extent of importance to poverty reduction. From the available psychosocial constraints afraid
of failure and criticism, faulty socialization, and low dignity of labor and inadequate motivation are the most serious problems
that young entrepreneurs are facing.