Does being self-employed make you happier?

There's no simple answer when it comes to self-employment and happiness levels
By Naseem Jamnia  Published on 05/15/2018 at 11:00 AM EDT
Illustration by Brenna Daugherty

Research shows that those who are self-employed are generally happier than “wage-earners,” people working regular jobs. A recent study in Work, Employment and Society by Professors Peter Warr and Ilke Inceoglu explores this further.

Warr and Inceoglu cite a variety of studies that indicate that people who are self-employed are generally happier, experience the same levels of stress and anxiety as wage-earners, and are, overall, more satisfied with their jobs. But the researchers wanted to dive deeper, differentiating among different types of jobs (e.g. managerial vs. non-managerial; complex professional vs. semi-skilled), and the different factors that contribute to overall well-being, job challenges, support, etc.

After surveying about 3,000 people, 300 of whom were self-employed, they came away with more complex results than previous studies. Overall, if you’re not in a managerial position, you’re more likely to be happier if you’re self-employed as well as engaged in your work. Furthermore, no matter what type of position you’re in, self-employment gives you more agency, but also more competition and demanding tasks—something that might actually be really exciting for you.

A follow-up study by Warr dug into these results. He found that people who are self-employed value self-direction more than traditionally employed people. They also feel a higher sense of accomplishment and job satisfaction, but only compared to non-managerial workers. He also confirmed previous findings that self-employed workers experienced the same—not more—stress compared to their wage-earning counterparts. This was even true of self-employed managers (e.g. someone self-employed who hires others).

Rather than conclusively showing that people who are self-employed are happier, these studies give a nuanced approach to factors you should consider before making the leap from a traditional job to working for yourself. For example, how do you feel about self-directed work? Do you prefer leading the way or being told what to do? Do you enjoy constant challenges at work, or would you rather make a living however it happens? If leading the way and doing demanding work doesn’t scare you away, then self-employment could be a good route. After all, there are nearly 17 million people in the US are self employed. There are plenty of lists to see if self-employment is right for you, including blogs that are centered around self-employment—so make sure to review all the factors to see if it’s the right fit for you.

But these studies also show that there are reasons to stick with a more traditional workplace. Is your current job a managerial position? Are you looking to feel competent in your work, have a higher sense of self-worth, or make more money? If any of these are the case, you might not find that a switch to self-employment will magically make you any happier. Warr and Inceoglu found that self-employed workers and wage earners experience the same levels of self-worth, power, achievement, sense of competence, or security. Remember too that if you’re self-employed, you lose the benefits that come with a traditional job—insurance, days off, etc. Which can put a damper on any potential happiness tradeoff.

The important thing to take away, is that you have to know yourself—really know yourself. For example, in the time I’ve been self-employed, I’ve learned that I’m not as self-directed as I thought, and that marketing myself is difficult because of my debilitating phone anxiety. But if you have no problem pitching your services, picking up the phone and cold-calling, or are willing to learn to do those, then self-employment could be a good fit. If you are organized and able to keep on-task, are unafraid to take risks, and are willing to put in extra time, then it could be really worth it.

It’s naive to make the blanket statement that “self-employment makes you happier,” but what I can say is that for some people, self-employment does do just that. It works for them. And if it works for you, too, then it’s worth seriously considering. After all, you might be closer than you think to job happiness.

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