Pros and cons of Self-Employment
The decision to become self-employed is never made lightly. There is always an element of risk involved as you relinquish secure employment to follow a dream of greater autonomy, flexibility and reward, and become your own boss. It is important therefore, if you decide to take the leap, to do so with your eyes wide open to the potential difficulties as well as the benefits. In this blog I have listed what I consider to be the chief pros and cons of self-employment, for you to weigh up and come to your own conclusions about the best route for you.
One of the most obvious benefits of self-employment is that you get to decide when you work and when you don’t. If you are not a morning person, you can avoid the struggle of the morning commute, and work happily into the small hours: if you are a morning person, you can be up at five and done with work by midday. At the end of any day, it is simply about getting the work done to the satisfaction of the client.
Another great advantage is that you get to choose where you want to work, which is of particular relevance for anyone with a disability. You get to make your office wherever you have internet access: your home, a beach or a bar if that is what works for you. If you do have a disability, you also have the privacy to deal with any medical issues you may have, away from prying eyes.
Being your own boss
Increased autonomy, at least in theory, is another of the great perks. If you are successful at what you do, you get to choose your clients, and you don’t have a boss issuing unrealistic deadlines without any real understanding of what exactly it is that you are doing.
Sole trader status provides the opportunity to make more money. Although this is less the case than it used to be, hourly rates for the self-employed professional are generally higher than those you would earn pro rata in a full-time job. As a one-man band or small operation often working from home, you generally represent better value to a client and can be more competitive than many larger operations.
Of course, there are also plenty of potential negatives, otherwise everyone would be doing it. Potentially the greatest is that there is no guarantee of work or income, and unless you can secure long-term client contracts you are working from month to month with no clear income projection, which can make long-term planning difficult. This means you have to be on top of your game at all times, not only in terms of the work that you do, but also in terms of marketing, promotion and invoicing. These are all time-consuming activities that eat into your work time, only producing an income stream indirectly at best.
When deciding on your billable hours, you also need to factor in the reality that you have forfeited the right to holiday and sickness pay, and so your income needs to include provision for a contingency fund to cover these expenses which conventional employees have provided for them.
One of the most commonly ignored negatives of self-employment is that it can be very lonely, particularly if you are a one-person operation working from home. There are no work colleagues with whom you can discuss your work, and you have to take responsibility for your own career development. This may be a particular issue for people with disabilities, who can find that their disability is often isolating in itself.
This is a very simple list of pros and cons, but hopefully provides at least some food for thought.
To find out more about self-emploment please visit ‘ Top 30 tips for becoming a sole trader’ blog.