Why millions of people want to become self-employed

More people want to become self-employed in 2019. New research reveals who's making the change and why they're doing it.

A massive 2.6 million Brits want to start their own business in 2019, according to research from FreeAgent.

Others aren’t quite ready yet. A further 15% say that they want to work for themselves in the next few years and over a quarter (26%) said that they want to start their own businesses but don’t have any set plans to do so.

Northern Irish entrepreneurs and Generation Z lead the way

Northern Ireland has the highest number of budding entrepreneurs who want to start their own businesses by the end of 2019 (18%), followed by London (13%) and the West Midlands (10%). Meanwhile, 19% of respondents in Scotland say that they want to start their own businesses in the next few years.

The naturally entrepreneurial Generation Z are more likely to go it alone, with 16% of 18-24-year-olds stating that they wanted to start their own businesses this year. A smaller 7% of 45-54-year-olds and only 3% of those over 55 plan on doing so.

A quarter (25%) of Generation Z said that if they don’t start a business this year, they will in the next few years, compared with 21% of Millennials.

Ed Molyneux, CEO and co-founder of FreeAgent, said: “It’s so important for any new business owner to make sure they are fully prepared before they start up. One of the main reasons that new businesses fail is because they cannot maintain a healthy cash flow, so drawing up a detailed business plan and staying on top of your finances is key if you want to make your venture a success.”

“It’s interesting to see that the younger generations are the most driven to become their own boss, especially in the current political climate. While many are wary of starting their own business in light of Brexit, it’s great to see so many Brits taking the plunge and doing so, helping to grow the economy and create jobs.”

Why people want to work for themselves

It seems that most respondents want a better work/life balance, with many wanting to follow their passion and choose the work they do.

Reasons why people want to be self-employed

I want a better work / life balance45.63
I want to choose what work I do43.92
I believe the sense of achievement would be greater35.48
I want to follow my passion34.57
I would like to work fewer hours29.75
I believe I could earn more as my boss / going freelance 28.94
I would like to fit work around family commitments27.04
I'm sceptical of the current employment landscape15.98
None of the above1.71

Source: Freeagent

Going self-employed to ditch the boss

There is another reason why workers want to go solo.

According to a separate study by AXA Business Insurance, almost eight out of ten people say that ditching the boss is the main reason why they want to go self-employed.

Other reasons include a better work-life balance (66%) and more money (46%).

It appears that it’s worth the gamble. In a separate survey from the AXA, 82% of people say that their life is ‘much improved’ since they started working for themselves.

Only 7% say that life is harder being their own boss.

Finding the confidence to become self-employed

Drumming up enough self-belief is the biggest barrier to people who want to work for themselves.

When asked what was stopping them, half of respondents put it down to a lack of self-confidence rather than the financial and practical sides of self-employment.

A substantial 36% of people said their current employment damaged their self-confidence, making it harder to leave and start their business.

Meanwhile, 30% traced their lower self-esteem back to their school days – think bullies, teachers and classmates – while 22% pin it on poor mental health.

The research shows that making the change later is a better idea.

Reportedly, the happiest age to become self-employed is in your late thirties and early forties – 93% of people in this age group said their life had improved as a result of going it alone.

Gareth Howell, managing director of AXA Insurance, says that people are drawn to self-employment to get out of a damaging workplace situation, ‘We know people often suffer loneliness, fears of inadequacy, money worries and long hours when they first start up, so you do need to be battle ready,’ he says.

As a caveat, he notes that we shouldn’t be bashing the bosses.

“Most people aren’t talking about escape, more about simply reaching a point where they’ve outgrown their workplace, bosses included,” he says.

Further reading on going self-employed

Six tips for thriving in a one-person business

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Anna Jordan

Anna is Senior Reporter, covering topics affecting SMEs such as grant funding, managing employees and the day-to-day running of a business.