POSTED BY: Jim Ittenbach | September 18, 2009
Frustrated with your job? You might consider working for yourself. Self-employed adults are significantly more satisfied with their jobs than other workers, according to new research.
Self-employed adults also more likely to work because they want to and not because they need a paycheck, according to a recent survey by the Pew Research Center Social & Demographics Trends project.
But don’t count on becoming financially secure if you become your own boss. Self-employed men and women have virtually identical family incomes as other workers but they feel more financial stress, the research showed.
About 11% of all working adults ages 16 and older are self-employed, according to data collected by the federal government’s Current Population Survey. Their jobs vary widely, from small business owners and consultants to fishing guides and freelance writers. Included in the ranks of the self-employed are private contractors, artists, construction workers, day laborers, farmers and agricultural workers, as well as doctors, lawyers and accountants who practice alone.
Why do they work? Money is one reason – but it’s far less of a factor for the self-employed than for other workers. Nearly a third of the self-employed (32%) say the main reason they work is because they want to, compared with 19% of wage and salary workers. By the same token, the self-employed are less likely than other workers to say they hold a job because they need the money (50% vs. 38%). They also place a higher value on the intangible psychological benefits of working such as feeling useful and productive, and are more likely to say they are working to help “improve society” (55% vs. 46%).
While being your own boss may have many rewards, a hefty income isn’t necessarily one of them.
According to Current Population Survey data, the median annual personal income of self-employed workers in 2008 was about $35,357 – only a few hundred dollars higher than the earnings of wage and salary workers.
But even though they earn about as much as other workers, the self-employed struggle more financially: Fully four-in-ten in the Pew Research survey say they just make ends meet or fall short, compared with fewer than a third of all wage and salary employees.
This survey does not directly answer why the self-employed feel disproportionately stressed; one reason may be that self-employed workers have to pay for benefits such as health care that many employees receive from their companies.
To read the entire report, click here.