Being your own boss brings benefits, but not always more money

Autonomy has long been considered extremely valuable and rewarding in the workplace. Harvard Business School research reminds us, however, that while being our own boss can bring us many benefits, more money may not be one of them.

The notion that self-employment and the autonomy it brings has a long history. For example, a 2018 study found that the self-employed not only found the job more rewarding, they also enjoyed it more than their full-time working peers. This is despite the fact that they often work longer hours and have less job security than their salaried peers.

Analytics found that self-employed people were more engaged at work because of the freedom they had to innovate and control their work environment.

"Engagement in their work makes people feel empowered and satisfied with their own contribution," say the authors. "Measuring how engaged people are in their work is therefore a very useful way of assessing their well-being and shows that we need to go beyond just job satisfaction."

Of course, this autonomy is also characterized by a lack of certainty, and the pandemic has underscored the pitfalls this can bring, with research from the London School of Economics showing that the early months of the pandemic were defined by a significant drop in both working hours and earnings for the self-employed, with a larger drop than for any type of worker.

While this has recovered somewhat over the summer months, hours and revenue remain significantly below pre-pandemic levels. Indeed, half of the self-employed surveyed revealed that their earnings remained below £1,000 a month in August. While this figure was slightly lower than April, it was significantly higher than the 33% who said the same before the pandemic.

Tracking analysis found that although there has been a gradual recovery, 40% of respondents said they had even less work than usual in August 2021, with the majority attributing this to the pandemic.

This reduction in work is reflected in the nature of self-employed earnings, with almost half earning less than £1,000. It shows little change from figures from January 2021, when the UK was in the midst of a second national lockdown. So it's hardly surprising that in September 2021, nearly a third of self-employed people said they struggled to meet even the most basic expenses.

The Harvard team examined the nature of self-employment over the past 50 years and found that while the number of jobs held by independent contractors has tended to remain fairly stable, it is less common than people start businesses that require a decent amount of capital.

Additionally, they also found that local entrepreneurship in his hometown has also declined, with the self-employed rarely being among the top earners in their respective communities.

"It became more difficult to make substantial profits at these smaller levels," the researchers explain. "It's hard ...