In 2011, it was estimated that more than 42 million individuals in America operated as freelancers or independent contractors. This number has continued to rise, and research conducted by Intuit suggests that by 2020 this demographic will account for approximately 40% of the U.S. workforce. While many may consider this to be a reflection of technological advancement and the ultimate embodiment of the American Dream, however, it also exposes citizens to considerable and diverse risk.
Employment vs. Home Business Ownership: How to Determine Whether or Not it is Right for you
If you are approaching a crossroads in your professional career, you may well be considering establishing a home business or Internet venture as an individual. If this is the case, you will need to think carefully and evaluate the potential benefits in line with the various risks associated. Without adopting this cautious approach, you run the risk of making a rash decision that does not represent either your professional or financial interests in the long term. Consider the following factors prior to making your decision: –
• The Value of Salary in Comparison with Corporate Benefits: Depending on the industry in which you work, you may be able to earn more as a small business owner than an employee. Bottom line salary is not the only figure that contributes to your financial well being, however, as the benefits packages available to traditional employees are far superior to those available for individuals who work independently. When you consider the protection and peace of mind provided by healthcare coverage, life insurance and performance related bonus remuneration, it is clear that you will be sacrificing considerable financial benefits should you leave your traditional role of employment.
• The Nature of your Chosen Market: While it is important to consider the wider financial implications of working independently, you should also think carefully about the nature of your chosen industry and its current state. While some sectors such as financial services have flourished during the last 6 months, others such as the construction industry have continued to fluctuate wildly and on a global scale. So if you operate in a prosperous market then now may be the ideal opportunity to go it alone, especially if you are capable of effectively marketing yourself and the service that you offer. If your skill set belongs to a struggling industry, however, it may be better to remain in employment and retain your existing job security.
• The Costs of Establishing a Home Based Business Venture: Success as a small business owner is ultimately determined by bottom line profit rather than turnover, which means that the cost of establishing your venture will play a key part in influencing your next career move. One of the primary appeals of home based, Internet ventures is that they typically boast low start-up costs, which makes the transition from traditional employee into online entrepreneur far more manageable. If you can reasonably expect to launch a low cost business start-up and exceed your salary as a company employee, then now may be the ideal time to embrace the world of entrepreneurship.
Author Bio: Lori Robinson is the senior writer & publicist for a leading car and health insurance comparison site Monkey. The site donates £10 to a charity of your choice for every car insurance quote taken out through Monkey.