Benefits of being self-employed

It holds that entrepreneurship is often a difficult undertaking, as a vast majority of new businesses fail.

This free encyclopedia says understanding of entrepreneurship owes much to the work of economist, Joseph Schumpeter and the Austrian School of economics. In Schumpeter (1950), an entrepreneur is a person who is willing and able to convert a new idea or invention into a successful innovation.

Entrepreneurship forces "creative destruction" across markets and industries, simultaneously creating new products and business models. In this way, creative destruction is largely responsible for the dynamism of industries and long-run economic growth. Despite Schumpeter's early 20th-century contributions, the traditional microeconomic theory of economics has had little room for entrepreneurs in its theoretical frameworks (instead, assuming that resources would find each other through a price system).

It states that entrepreneurship received a boost in the formalized creation of so-called incubators and science parks where businesses can start at a small scale, share services and space while they grow, and eventually move into space of their own when they have achieved a large enough scale to be viable stand-alone businesses.

The behavior of the entrepreneur, it holds, reflects a kind of person willing to put his or her career and financial security on the line and take risks in the name of an idea, spending much time as well as capital on an uncertain venture.

Still, another view of entrepreneurship is that it is the process of discovering, evaluating, and exploiting opportunities, which go on to reify themselves in the form of new business ventures. In this model, says Wikipedia, an entrepreneur could be defined as "someone who acts with ambition beyond that supportable by the resources currently under his control, in relentless pursuit of opportunity" (a definition common to entrepreneurship professors Howard Stevenson and Jeffry Timmons).

Pinchot (1985) coined the term Intrapreneurship to describe entrepreneurial-like activities inside organizations and government. The concept is commonly referred to as Corporate Entrepreneurship.

• The entrepreneur has an enthusiastic vision, the driving force of an enterprise;

• The entrepreneur's vision is usually supported by an interlocked collection of specific ideas not available to the marketplace;

• The overall blueprint to realize the vision is clear; however details may be incomplete, flexible, and evolving;

• The entrepreneur promotes the vision with enthusiastic passion;

• With persistence and determination, the entrepreneur develops strategies to change the vision into reality;

• The entrepreneur takes the initial responsibility to cause a vision to become a success;

• Entrepreneurs take prudent risks. They assess costs, market/customer needs and persuade others to join and help;

• An entrepreneur is usually a positive thinker and a decision maker.

In summary, entrepreneurship is simply self-employment. Or if you like, being your own boss.

But one pertinent question is: why do people want to be their own boss? In other words, what benefits do people derive from being their own boss? This is the question I am here to answer.

The first benefit to be derived from entrepreneurship or self-employment is one that Nigeria as a corporate body stands to enjoy. Today, unlike in the past, paid employment is scarce commodity. If we go by current industry statistics, about 164,000 graduates are produced by our tertiary institutions every year. And we do not create 164,000 jobs every year.

We therefore have problems in our hands. Even if we go by another variant of statistics that looks more ‘patronizing’, we still have problems. In any given year, over three million Nigerians, statistically, become qualified to join the labour market, out of which about a 100,000, university and polytechnic graduates, constitute highly skilled labour. Only 10 percent of this highly skilled labour is opportune to join the formal sector. Similarly, statistics from the International Labour Organisation (ILO) indicate that at least 70 percent of recent school leavers in Nigeria are unemployed, while 90 percent of these individuals are underemployed. And we continue to lose a good size of our human capital to other nations, where they contribute in no small measure to the development of the host economies, while those who cannot go abroad remain frustrated, unemployed and underemployed.

One major benefit of self-employment, therefore, will be job creation. If graduates set up their own businesses, they will employ themselves and employ others.

Let us now look at the benefits of self-employment ‘proper’. Having the time of your life, is one outstanding benefit. This looks contestable. Yes, it does. But let’s look at it closely. Industry experts argue that having a job is like putting a mortgage on your time, and thereby on your life.

With a job, they hold, you have agreed to be in some specific place doing some specific thing for the bulk of your working day, five or more days a week. And hear this, according to Serah and Paul Edwards, the celebrated self-employment experts: While you might think financial gain is the primary reason people choose to become their own boss, research shows that the majority of self-employed individuals don’t go out on their own for the money.

According to a poll conducted by United Group Information Services, only 3 percent of small business owners do what they do for financial gain.

The other 97percent say they are on their own because they want to be in charge. In other words, it is more freedom not more money, that lures us away from our pay cheque. This is a survey done in the U.S. Can this apply here in Nigeria? I do not think so.

If you ask me, I will say it is a combination and more money that is the lure in Nigeria and developing countries generally. In fact, there was one Nigerian pastor, a lady who was guest pastor in the Redeemed parish where I worship, who told the congregation "you cannot be a rich man if you remain in paid employment". I think she is right. The fact, is that you do not get more freedom working for yourself.

There is more to do when you are your own boss. But the interesting thing is you know what you are working for – you know you will smile to your bank.

Then there is this aspect which research also confirms. With you working for your self, you have less stress to cope with. The more control you have over what you do and how you do it, the less stress you experience. Time pressures become a problem to solve, not a burden to bear.

With self employment, you are your own boss so you can take charge of what you do with your life. With self-employment, you know what you are doing, you can therefore direct yourself competently and thereby use the precious hours of each day the way you wish.

It is about acquiring a new attitude towards time, an attitude you couldn’t have when your time was mortgaged to someone else. It is about approaching time as a resource, you can draw upon and spend as you choose, not as a constraint you have to leave with or an enemy you must struggle against.

In summation, the benefits of entrepreneurship or self-employment are freedom, freedom from stress, freedom to earn more money and in some cases, a desire to transform society – in this case, social entrepreneurship.

I commend the efforts the National Association of Business Administration and Management Students (Yabatech Chapter) the organisers of this seminar.

I must say you are on the right track. Self-employment is the vogue now, not only in Nigeria but all over the world. In 2006, some students of the Massachusetts Institute of Technology (MIT) Sloan came visiting from the US.

I was privileged to have a one-on-one conversation with some of them. They were students with first degrees in the sciences – Medicine, Engineering, and Technical Science, who found it fit to enroll in Massachusetts Institute of Technology to study the art of management, management of technical business, that is technoentrepreneurship.

Joshua M. James, one of them, studied Industrial Engineering at first degree level before entering for MIT’s MBA. He had planned to start a company that is

industrial engineering-related after MBA. Kerry Bowie, one of them, is a high flier with Bachelor and Masters Degrees in Environmental Engineering. Why MBA? I asked

him. His response: "I realized that as an engineer most of the decisions being made are not purely analytical from a project perspective and real. I

believe that if I am to truly excel in my business, I would need to pick up some of the business acumen inherent in economics, finance and accounting".

And here in Nigeria, in our campuses (I am sure it is true of Yaba College of Technology too), we have students who are combining their studies with one form of business or the other.

My first daughter, Yomade, is a 400 level student of History and Diplomatic Studies at Olabisi Onabanjo University, Ago-Iwoye. She is into interior decoration business. Her younger sister, Doyin, a 300 level student of Metallurgical and Material Engineering, at Federal University of Technology, Akure, is into cosmetics business. They are earning money by the side; their business activities give me some good relief.

Business Day has a working relationship with CampusGist, a student magazine on entrepreneurship, based at the Obafemi Awolowo University, Ile-Ife. The magazine, driven by Victor Giwa, a law student of the same university, has a collection of 1000 student entrepreneurs. Interviews with these students are published regularly in Business Day. You can be one of these student entrepreneurs, if you are not already one.

That is the spirit.

There are a lot of business opportunities. But that is a subject for another day.