Self-employed people and pension: is old age poverty the inevitable dark side of an entrepreneurial society?

The relationship between financial distress and well-being: Exploring the role of self-employment

“…In particular, financial distress had a greater negative association with overall health and life satisfaction for the solo self-employed compared to wage-workers, while the negative association with mental health and quality of life was found to be most pronounced for the self-employed with employees. These results should be of major importance for policy makers as we confirm earlier findings by Boegenhold and Klinglmair (2015) and Fachinger and Frankus (2017) showing that a greater share of self-employed may be considered precarious in terms of having money worries. This holds particularly for the solo self-employed.…”

“…The impact of low income on well-being is likely to be stronger if there are no alternative resources available to meet financial responsibilities. Savings, and hence financial health, varies considerably and particularly among the self-employed (Fachinger and Frankus, 2017). Hence, we use a broader measure of financial health that considers a person's complete financial situation, an approach that is consistent with the OECD's analysis of income and wealth on well-being (OECD, 2013).…”

“…Indeed, self-employment is a highly segmented occupational category with differing degrees of success, well-being and stress levels (Cieslik and Dvoulety, 2019). Notwithstanding this heterogeneity, it has been found that precariousness is a greater problem among the self-employed and particularly, the solo self-employed, than among the wage-employed (Boegenhold and Klinglmair, 2015; Fachinger and Frankus, 2017). However, what is less clear is whether the well-being consequences of precariousness, in particular that of financial distress, differ among the wage-employed and self-employed.…”

Foreword: JMO special issue on self-employment/freelancing

“…As Meager (2008, p. 200) notes, ‘… the presence of self-employed spells in the previous work history does increase chances of poverty, low savings levels and poor pension entitlement in later life’. The inadequacy of the pensions and social security systems in many countries to accommodate the needs of self-employed people is well-documented in many countries (see, e.g., Frankus & Fachinger, 2012; Fachinger & Frankus, 2015). Employment rights and the development of a new approach which extends some of the protections which employees take for granted, to those ‘self-employed’ in the grey zone between employee status and genuine entrepreneurial independence (the ‘hybrid’ workers of Boegenhold), with a particular focus on the new contractual forms emerging in the ‘gig economy’ or ‘sharing economy’.…”

“…As Meager (2008, p. 200) notes, '… the presence of self-employed spells in the previous work history does increase chances of poverty, low savings levels and poor pension entitlement in later life'. The inadequacy of the pensions and social security systems in many countries to accommodate the needs of self-employed people is well-documented in many countries (see, e.g., Frankus & Fachinger, 2012;Fachinger & Frankus, 2015).…”