What Are the Benefits of Self-Employment? (With Examples)

By Indeed Editorial Team

Updated January 19, 2023

Published November 30, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

There are many benefits to pursuing self-employment. You may want to become self-employed to enjoy the freedom of working for yourself or a personal sense of accomplishment. Learning about the benefits of being a self-employed professional can help you decide whether business ownership is right for you. In this article, we explore the various benefits of self-employment and discuss some potential disadvantages.

What are the benefits of self-employment?

Understanding the answer to "What are the benefits of self-employment?" can help you decide whether this is something you want to pursue. It can be an excellent career choice for people who have strong ambitions and desire more freedom and agency in their professional lives. If you're ambitious, owning your own business and being in charge of your own professional life may be the best way to use your skills and experience control over your career. Below are some benefits that can come with the self-employed working lifestyle.

Related:

  • What Is Self-Employment? Definition and Common Types

  • Differences Between Being Employed vs. Self-Employed

  • The Top 20 Best Self-Employed Jobs With Added Salaries

Independence

Self-employment can offer a sense of freedom that may not always be available when you hold a conventional job as an employee for a company. When you're self-employed, you can choose your work hours and work routine. You can adapt your work schedule to align with your habits and preferences. You can also rearrange your schedule if there are life changes or single events that demand your time, an excellent benefit if you have many commitments in your personal life.

For example, if you're a self-employed artist working from home, you can decide to make your work schedule from 10:00 a.m. to 3:00 p.m. You can allot time to work on your paid projects and commissions. You also don't have the burden of a commute because you can set up an artist's studio in your home. If you have an appointment or if you have a family obligation that requires more than an hour of your day, you can adjust your schedule accordingly without having to explain the situation to a manager.

Related: 10 Key Entrepreneurial Skills You Need To Start a Business

Creative freedom

Self-employment offers many opportunities to express your creativity that may not always be available in conventional employment. You can use your artistic skills and provide a specialized product or service to clients, such as creating a business to sell handicrafts that you made independently. You can also start a business where you can demonstrate your ability to solve problems and be inventive. Consider your hobbies and the creative outlets that you do regularly. You can adapt your skills into a profitable business venture.

For example, if you're a tailor who loves fashion, you may have the skills to create high-quality clothing. If you work for a retail store as a salesperson and enjoy the fashion industry, your current position may not offer opportunities to use your sewing skills. You can start your own business by designing original clothes to sell to the public, creating new clothing based on your clients' requirements and completing alterations, allowing you to enjoy the creative freedom of self-employment.

Related: Freelance vs. Self-Employed Work: What's the Difference?

Direct customer service

As someone self-employed, you are your customer service representative and control all your business' marketing and social aspects. You can develop your relationships with your clients, allowing you to agree on prices and work hours for your services. You can build a reliable network of clientele who might promote your services to others. Creating your network can be a great advantage because you can gain new clients who trust you to provide a satisfactory product or service based on the work you provided for their acquaintance.

For example, if you're a contractor who does home renovations, you can negotiate payments and work hours with your clients yourself rather than through a company. You can build a relationship with your client and negotiate to reach a fair price for a window installation or remodelling a bathroom. After providing quality work, you can request that your client recommend your services to others, which may require you to use your social skills and self-confidence.

Related: A Beginner's Guide to Freelance Jobs

A curated team

Another benefit of self-employment is that you can choose the people that you work with at your company. This can be a great advantage if you're in charge of your own business and require professionals with specific qualifications. You can conduct interviews, hire your team members, and you can communicate directly with them to solve issues and build friendly and productive work relationships. Developing your leadership skills and becoming a mentor can help the business prosper.

Consider fun and creative ways to develop your relationships with your employees, such as team-building exercises. For example, you can organize a scavenger hunt to encourage problem-solving and collaboration, and everyone can work together to find specific items within a time frame. This exercise can be an exciting way for you and your team to practice reaching a mutual goal and meeting a deadline. You can research other team-building activities online or get a book on team-building for more inspiration.

Unlimited earning opportunities

As someone self-employed, you can negotiate your compensation with clients. You can also negotiate pay rates with companies as either an independent contractor or freelancer. Many companies may be willing to pay a self-employed person more than a regular employee for a specialized job. You can also deduct business expenses from your yearly taxes if you're working from home or bearing the cost of equipment or machinery. You can increase the profit you make from your jobs with tax deductions. Consider arranging a meeting with an accountant to discuss which expenses are tax-deductible.

You may require a level of financial education, as it may be your responsibility to calculate your pay rates. You can reach agreements with clients that can bring you a profit. Consider taking a course that offers instruction for managing the financial aspects of a business. You can also purchase books on managing your finances as a self-employed person at your local bookstore to work even more independently if you have strong financial skills. Consider speaking with a friend or acquaintance who has experience managing their own business. They may offer valuable advice and guidance.

Related: 17 High-Paying Freelance Jobs (With Salaries and Duties)

Self-improvement opportunities

Self-employment can be a significant transition in your life. You can use the transition period from employee to self-employment as an opportunity to improve your existing skills and develop new ones. Consider taking short courses or online self-study programs. You can choose courses that are related to the business you wish to operate as a self-employed person.

For example, if you work as a teacher for a school board, you can decide to open a private tutoring centre in your own home instead. You can take refresher courses in common tutoring subjects such as math, French, and language arts. You can expand your knowledge of those subjects and take classes in finance to understand the business components of operating a private home business. Learning this new skill can ensure you're competent at managing money and making a profit. You can then open your tutoring centre with both your existing and newly acquired skills.

Related: Importance and Common Types of Compensation

Disadvantages of self-employment

There are some disadvantages of self-employment that you may want to consider before you pursue it. Self-employment does not always offer the same work benefits available when you work for a company as an employee. It may take more time to organize steady and consistent work hours and profit in your business. Self-employed people are also responsible for funding their own vacation time and insurance plans.

If you feel prepared to take on these extra responsibilities, self-employment may be an excellent career choice. These disadvantages may also become more advantageous once the company establishes itself and earns a consistent profit. For example, there are no limitations to vacation time as long as the company can operate in your absence as a business owner.

Now that we've explored the answer to the question "what are the benefits of self-employment" and discussed some potential disadvantages, you'll be better prepared to decide if business ownership is right for you.

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