Entrepreneurial career outcomes of women who switch to self-employment during the crises

Abstract

This paper aims to reveal the implication of transitions from paid to self-employment during the period of economic crises, and whether such a transition may widen the gender gap in career outcomes. We use insights from the career perspective in entrepreneurship to study career outcomes in three steps. First, we study the survival rate and the career patterns of individuals who switch to self-employment in the post-crisis period. Second, we examine income, job satisfaction, and life satisfaction, as the subjective and objective measure of career success of individuals who survive in self-employment. Lastly, we look at the possible differences in entrepreneurial career outcomes between male and female self-employed in our samples. We use descriptive statistics and entropy balancing to examine the changes in career outcomes of individuals who switch to self-employment during the 1998 Asian financial crisis in Indonesia and the 2008 global financial crisis in the United Kingdom. Our findings demonstrate that in both countries, the survival rate is less than 50% for over 5 years following the transitions, with the risk of experiencing downward job mobility for those who do not survive in self-employment. In addition, our study reveals that transitions to self-employment give no gains to the individuals; as the career outcomes of those who switch to self-employment are relatively similar or even not any better than similar individuals who remain in paid employment. Lastly, we found a smaller proportion of females survive in self-employment in the long term, as those who switch to and survive in self-employment in both countries are dominated by males.