Deciding on a career path can be one of the most important yet tough choices you make in your life. A career that you are not only successful in but also enjoy doing will affect all aspects of your life in a positive way. An average millennial will switch career paths several times within their lifetime for various reasons. But when making the choice, it’s important to consider all the different factors that play out in a career, including job security, financial stability, and the job market.
What is Employment?
Employment is a contract or agreement between two parties, one being an employer and the other being an employee. The employee will lend his labor and expertise to the employer and is hired to perform specific duties that are packaged into a job. In this situation, the employee has less freedom over their time and earnings, as it is laid out by the employer and the organization they are working with.
What is Entrepreneurship?
Being an entrepreneur means having more freedom in deciding the workload and work hours, as well as having less supervision in terms of how the work is done. If you are working as a contractor or an independent service provider, you have the opportunity to decide what clients you want to take on, when you work, and how you and your future organization (if you decide to expand your business practice) operate.
Employment vs. Entrepreneurship
Growing up, you are always told to study hard and get a good degree. Having a good degree will land you in a good job and in return, a better life. However, in the modern era, this belief is now starting to change. With the emergence of Social Media and online retail stores, online selling and online businesses are flourishing. The growth of entrepreneurs all around the world is not only limited to online businesses.
Let’s take a look at the pros and cons of both, employment and owning your own business a.k.a. entrepreneurship:
As an employee when you clock out, you’re done with work. You can go home to your family and forget about your job. As an entrepreneur, this is a little different. When you’re working for yourself it can be really hard to get out of work mode. Especially if you work at home. Your computer and phone are always near you and it’s so tempting to check your email or do a little more work.
The advantage is that depending on your business, you may get to work fewer hours than an employee would and therefore get to spend more time with your family and friends.
Employees measure success by how much they get ahead in their organization. Employees may focus on performing better than their colleagues and amassing authority over colleagues. Entrepreneurs set their own goals and action plans, then work to achieve them. According to research, entrepreneurs who succeed don’t give up and keep working on their business until they turn a profit.
Number of Hours Worked
As an employee, an average full-time job consists of 40 hours per week. You go into work, keep busy for eight hours, and come home. After factoring in your commute, the time you’re committing to your day job maybe a little bit higher.
As an entrepreneur, your hours will vary greatly. When you’re first starting up your business you may put in 60 -80 hours of work per week. But once you establish yourself and/or outsource parts of your business the number of hours you work can be greatly reduced. Also, you may be able to replace the income from your day job in much less time than 40 hours giving you a significant amount of free time if you don’t wish to increase your workload.
As an employee, the stress level is generally pretty low. As you go to work, you know what is expected of you, put in your hours, and come home. As an employee, you don’t have to worry about where your next paycheck is coming from or running the daily operations of a business.
When you work for yourself, especially when you just get started, you’re a one-man (or woman) team. Your pay fluctuates and if you don’t build multiple streams of income it can diminish overnight. You also have to wear many hats. You have to provide a product or service, market, network, find suitable employees when necessary, and be your own accountant. The direction of your business is up to you. This is exciting and stressful.
Employees usually have to come into work and leave at certain times on certain days of the week. Their employers determine their schedule, which they can’t easily change. Entrepreneurs, however, are in charge of their own schedules. They often have to dedicate a lot more time to the business at the beginning of the enterprise. After the business stabilizes, entrepreneurs usually have more flexibility with regard to their work schedule.
Money and Other Benefits
As an employee your income is limited. You put in your required hours and in return you get a paycheck for the same amount each week. Sure, you can move up the chain at work but eventually, your income will be capped. But on the bright side, not only do employees benefit from paid holidays, they usually get a bunch of other benefits. From free coffee to health insurance schemes, there are many other benefits beyond the monthly paycheck that they get to enjoy. It also means that should you fall ill; you know you have a company and some form of income to support you through those hard times.
As an entrepreneur the possibilities are endless. The amount of money you bring in and the rate your business grows is all up to you. The sky really is the limit. Whilst being an employee may provide a stable income, this income may also be capped at a certain point. By being an entrepreneur and building your own business there are countless options and possibilities. Not only can you grow your take-home income via revenue streams, but you can also choose to sell part of the business you have grown for a lump sum.
Dealing with People
If you cannot hold a conversation with someone, how can you expect to work on a team? How can you expect to pass an interview? For entrepreneurs, you need to find a way to make connections. You need some degree of people skills and you need to be able to communicate in order to survive in this world.
Entrepreneurs, just like employees, are going to need these skills if they want to be successful. Understand that being “social” is much different from being “connected”. It goes far beyond what you say. You could be a super social person, but if you are giving off the wrong vibe, then professionals won’t like you. Introverted people although not as social as extroverted people can be very well connected, and this is because they do not go over-the-top with words, they keep it sweet and simple as well as providing that comfort of less talking, more action.
So, whatever you decide, know that it will be important to learn some people skills. For entrepreneurs, it will help to deal with your future HR department, investors, sponsors, new deals, and new partners. For employees, it will help you get new jobs, better teamwork, new promotions, new deals (raises), and new opportunities. When it comes down to employment or entrepreneurship, take into consideration to build some people skills.
Which One Would You Choose?
There is no clear-cut answer to which is better. It all depends upon your goals and your personality. Sure, entrepreneurship can bring you the freedom to work when and where you want, but you still have to work. Contrary to what some of the gurus tell you, you’re not going to get far as an entrepreneur working four hours a week. It’s not going to happen. Overall, both areas have their own attraction and if you are satisfied with your job, you would not need to be an entrepreneur. Unless you are ready for the risks and challenges, a well-paid job is always a safer bet.
If you have your own business, don’t be afraid to take time to consider what you like and dislike about being an entrepreneur. If you still enjoy being your own boss, then continue moving forward with your business. And be sure to check out our blog on how to be a successful entrepreneur. But if you’re feeling a little burned out, you can take a break and try working for someone else for a while. No one has to be an entrepreneur or an employee forever.