Abstract
Abstract The UK has experienced very significant growth in self-employment since the financial crisis. The self-employed are at higher risk of income volatility while facing lower levels of social insurance. Individual transitions into self-employment may be driven by a range of factors, both ‘pull’ and ‘push’. This paper proposes a re-evaluation of the evidence on whether private sector business organizations stimulate entrepreneurial transmission amongst their employees. In the UK context rising self-employment may reflect the consequences of flexibilization and falling job quality, rather than outright job loss. Previous research has focused mainly on the subjective notion of job satisfaction to identify the level of attachment the future self-employed have to their current employer. Quantitative analysis is undertaken using large scale British longitudinal survey data. The paper extends this work to show that organizational (dis)attachment is evidenced in a range of extrinsic indicators of job quality, providing explanatory information beyond intrinsic job satisfaction. Specifically, the paper shows that the impact of training on self-employment entry depends asymmetrically on the source of that training. Finally, the paper argues that reduced attachment provides an alternative explanation for any ‘entrepreneurial transmission’ effect, through which employees, particularly those in smaller organizations, are more likely to enter self-employment. However, anticipated improvement in the experience of work from choosing self-employment is seen to be somewhat illusory, speaking to growing concerns about the impact of the growth of the gig economy.
Highlights
The self-employed account for 15% of the UK workforce (ONS, 2018)
The analysis we present in this paper suggests that entry into self-employment is strongly associated with the quality of prior employment experience
We find significant associations with a number of other extrinsic dimensions of job quality, even after controlling for low job satisfaction
Summary
The self-employed account for 15% of the UK workforce (ONS, 2018). Whilst self-employment may confer benefits in terms of individual autonomy, a significant concern is that the self-employed do not enjoy the social protection provision that other workers take for granted. Self-employment is highly heterogeneous, encompassing activity across a wide range of sectors and occupations, sometimes concentrated in particular demographic groups, sometimes as part-time activity alongside other work. It spans genuine business activity, usually as a sole-trader but sometimes as an employer of others, perhaps stimulated by prior experience with other entrepreneurs. In the UK self-employment growth may reflect flexibilization strategies and lowering of job quality on the part of employers This is in the context that the value of employee tenure is reduced (for employers and possibly for some employees, such as younger ones) through the use of digital worker surveillance and rating. As discussed in the paper, there is considerable disagreement on how to define job quality and how to measure it (Burchell et al, 2014)
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