Think you’re happy being self-employed? You may be surprised to find you’re not thriving as much as you thought you were.
Earlier this week, Gallup released the results of a worldwide survey examining the relationship between jobs and wellbeing. Not surprising, those who are employed full-time for someone else describe themselves as possessing more wellbeing than those unemployed and employed part-time. Compare full-time employees thriving at 29 percent to the unemployed and the part-time employed at 22 percent and 26 percent respectively.
Here’s the kicker: Of the self-employed, only 14 percent report themselves as thriving.
One might expect the self-employed to embrace the risk of entrepreneurship but still thrive or enjoy their wellbeing because they control their destiny more than those working for someone else. Understandably, those working full-time for someone else certainly will embrace the stability of a good job, especially during the 2009-2010 time frame during which Gallup conducted the survey. Still, one would think that more than 14 percent of the self-employed worldwide would thrive on the risk tradeoff for independence.
This part of the survey I think does more to inform us on the conditions of economies around the world than to inform us on our own wellbeing in America.
Consider how the statistics change when Gallup limits the survey to advanced economies. Full-time employed workers jump from only 29 percent thriving to 52 percent, while the full-time self-employed leaps from 14 percent to 42 percent. Even though the self-employed report thriving more in advanced economies, they still lag behind the part-time workers who report thriving at 49 percent.
Gallup suggests the difference between the self-employed in advanced versus Third World economies arises from opportunity versus necessity. In the former, the entrepreneur sees opportunity and strikes, while the latter has no time to search for opportunity but instead must focus on making ends meet.
When describing the implications for policymakers, Gallup confirms what most of us know: “Best prospects for quality job creation are small- to medium-sized enterprises. These companies are generally led by people who are self-employed by choice, rather than out of necessity.”
What strikes me about this suggestion is that the job creators claim they don’t thrive as much as their employees. That is, according to Gallup’s own polls, a larger percentage of full-time employees report thriving more than the self-employed whose population thrives less.
Perhaps this contrast reflects the nature of the self-employed / entrepreneurship more than the wellbeing of the individual. Naturally the full-time employee embraces his or her stable job; it offers security. However, the entrepreneur concerns him or herself with growth, while judging and pushing him or herself harder than the securely employed. Thus, self-employed people look ahead with vision to see where they could further grow and innovate. Ultimately the entrepreneurs conclude they are not thriving as much as they could, and therefore report thriving less than the full-time employee.
Naturally, we must then ask how do policymakers create an environment for these job creators to spur the economy? While many policymakers jump towards tax cuts and deregulation to spur growth, it only adds to one side of the picture.
We must also look beyond the tax and regulatory options for creating a prime environment to grow business. Local and state governments can allocate resources wisely. For example, levying taxes to create efficient sewer systems and energy grids enable overall costs to come down. Additionally, focusing on creating an intelligent work force that thinks critically from K-12 through higher education requires investment. In short, infrastructure spending and tax reduction will help create ripe environments that lead to good jobs and wellbeing.