Creating Your Own Job: The Self-employment Phenomenon

There's been a lot of attention focussed on people who work for themselves during the last few years. That's largely because a growing number of people are choosing this type of work arrangement.

There are many reasons why someone might decide to work independently rather than as an employee. Some relate to lifestyle preferences (you have a lot more control over what you do, and when you do it, if you're your own boss), while others are a reflection of prevailing labour market conditions.

Workers who've lost their jobs and can't find other employment that matches their skills may choose to start up their own business. So might someone who doesn't want or need to work full-time, but isn't ready to leave the labour market completely. A lot of retirees may choose this way of supplementing their pension income, as well as keeping their minds and bodies active, by pursuing interests that they haven't had time for in the past.

A person with an entrepreneurial bent who wants to try out a new idea or sell a product that he/she has made might start their own business. So could someone who has specialized skills, or whose skills are in such high demand that they can earn more as a contractor than they would if they were working as paid employees. Also, the nature of some types of occupations (for example, carpentry or dentistry) is such that self-employment is a very typical work arrangement.

Just how common is self-employment?

About a fifth of BC's workforce was self-employed in 2005. That's up from 16% in 1990. Most of these people work without any paid help. Only a third have paid employees; two out of three are working on their own or with the help of unpaid family members. That represents a significant departure from the past. In 1990, the number of self-employed people with paid help was only slightly lower than the number working on their own.

One in every five workers in BC is self-employed

 

 

…and most work without any paid help

The incidence of self-employment varies among different industries

One out of every two people working in the agriculture industry is self-employed

Fishing, hunting & trapping and agriculture are the industries where there's the greatest incidence of self-employment. Nearly half of the workers in agriculture are their own bosses and in fishing, hunting & trapping the percentage is even higher. The opportunity to work independently on a farm or fishing boat is one reason why many people choose to work in this industry.

One in three people who work in professional, scientific & technical services, construction, other services and business, building & support services are their own bosses.

These industries are particularly well-suited to self-employment, since they are labour-intensive, and rely a great deal on the unique skills of individuals who do the work. In most cases, starting up a business in these industries is feasible, since the required investment in machinery or equipment is not so costly that it is beyond the reach of most individuals. Once an individual has acquired the skills needed to do construction work, work as an accountant, lawyer or engineer, style hair or do janitorial work, it's possible to set up a small business with a relatively modest investment in capital equipment.

Self-employment is more common in goods industries (averaging 21% of the workforce during this period) than in the service sector (17%). However, it has increased more rapidly in the service sector than in the goods industries, where this type of work arrangement has traditionally been more common. The five industries that have seen the biggest increase in the number of self-employed are all in the service sector.

Service industries have seen the biggest increase in the incidence of self-employment since 1984

One reason why self-employment has increased more in the service sector than in goods industries could be the shift that is taking place in the industrial structure of the province. Service industries such as computer and engineering services are among the fastest-growing industries in the province. Home-based offices or partnership arrangements are quite common in these industries.

Being your own boss isn't risk free. It can be very satisfying, and in some cases, very lucrative, but there are a lot of self-employed people who don't succeed in their endeavours. Those who do succeed often spend long hours, and invest a lot of time and effort into building up their business. It might not be the right choice for you, but self-employment is an option you should consider when you're planning your career.