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Self Employed Living in Misery?

One headline on our website’s News Feeds caught my eye recently. It read: Self-employed “living in misery”, followed by a categorical advice from Business Coach Daniel Batten to all employed people to keep their 9-to-5 jobs and never venture onto dangerous entrepreneurial grounds.

Was there some truth to the statement, I asked myself? Am I, or any of my clients, living in misery? Yes, business is hard work and it’s true that many who go into business are woefully ill-prepared (like the couple in Alexandra I met who had just bought a motel who only had a 30 minute hand-over from the previous owners). The education system is not good either at giving people the necessary business or finance skills (or any skills for that matter given the headline the previous weekend about 1 million Kiwi adults lacking essential literacy & numeracy skills!) Nevertheless, I wonder whether the author of this advice had ever worked for some of the small employers in Hawkes Bay. I myself had the unhappiest six months of my life working for a local employer and just couldn’t wait to leave. Many others I meet have been or are still in that same boat.

But hang on though, is there a connection here? Is the reason that so many small employers are so awful is that they are potentially living in misery too, equally ill-prepared to deal with the challenges of business and employing people? Surely, it can’t be a lack of common-sense, or a failure to understand that to get the best out of people you treat others as you would wish to be treated yourself (a principle which, if followed, would mean that we could scrap all Employment Legislation).

We do need people to go into business to keep the economy going (especially in NZ where 90% of businesses are small). In addition, people cannot expect to earn a lot working for someone else, in what is now regarded as a low-wage economy. Being in business is the only  practical path to freedom and being better off for many people, especially in a provincial area like Hawkes Bay, which lacks bigger companies and all the career potential they offer.

So what can be done for those who want to get on or are entrepreneurial, but who lack that so-useful family background in business? More training seems to be the obvious answer. Unfortunately, the poor attendance of the NZTE subsidized business training programmes showed that they were not valued and, maybe for being free, taken for granted. Too many people would show up late and clear off early when showing up at all. Likewise, the educational seminars previously organised by the Chamber of Commerce have ceased, presumably through lack of interest. I am not sure whether the private training providers and business coaches are any better utilised. Maybe business owners are themselves the problem: unwilling or unable to see the need to acquire better business skills. I often encounter in my practice a “she’ll be right” attitude, the belief that issues can just be muddled through.

Maybe we should require budding entrepreneurs to get a licence to go into business. After all, in many trades or professions you need one (although of course they don’t test acumen or knowledge in the more important areas like finance or marketing!) An interesting proposition, although one could argue that such a requirement would end up putting unfair barriers in the way of the ambitious. Some very successful businessmen, I am told, could neither read nor write – although if you know of any please send in their names, as I have failed to find any examples myself.
More franchises could be another solution, as they provide the business owners with ready-built systems and a proven business model. For some maybe, with the right franchise, but not all: a lot of franchisees end up resenting the lack of freedom and rigidity of the structure they have bought into. Not to mention that some franchises could be a waste of money, as they do not actually represent any known brand, which means that franchisees end up paying a lot for not very much.

How about more government intervention or subsidies, like the previous NZTE business development grants or the up-coming voucher scheme? I will be interested to see whether the latter will prove any more popular than the grants. The risk with such programs, of course, is that the availability of taxpayer’s money sometimes only encourages petty fraud and an unrealistic attitudes.

Of course, one could argue that this just the way the free-market works: the survival of the fittest means that those ‘living in misery’ deserve to suffer as a punishment for their lack of planning, foresight and common sense. They will more likely give up in the end, leaving space to the more acute, skilled (or lucky) businessmen.
What’s your view? If you’re self-employed, are you living in misery, do you know someone who is, or was Daniel Batten just trying to drum up business for himself?

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Self-employed “living in misery” Published: 12:41PM Thursday July 15, 2010 Source: ONE News

9 Responses to Self Employed Living in Misery?

  1. Hi!
    Thanks for the nice comment. It’s always good to hear from your readers. You can always suggest topics for future posts if there’s a particular area of tax or business that you’re interested in or would like to know more about. We look forward top having you back.

  2. discounts says:

    I’d also like to express that most people that find themselves with no health insurance are normally students, self-employed and people who are not working. More than half in the uninsured are under the age of 35. They do not sense they are requiring health insurance because they’re young plus healthy. Their own income is normally spent on real estate, food, as well as entertainment. Most people that do go to work either 100 % or part time are not given insurance by way of their work so they head out without due to the rising expense of health insurance in the us. Thanks for the concepts you talk about through this web site.

  3. Thanks. Financial literacy is useful indeed!

  4. Thank you for the comment. Looking forward to having you back!

  5. Yes, being self-employed can be daunting sometimes. However with the right efforts in the right directions it reaps awesome rewards.

  6. Thanks for the comment and the suggestion. We’ll most definitely be posting more on the subject of self-improvement.

  7. No problem at all. Thanks for reading!