Employment VS. Self-Employment: What You Should Consider

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Our choice of working arrangements matters enormously. A huge range of factors, including stability, progression, lifestyle, commitments, and remuneration, all weigh in on how we work, so it’s important we weigh up our career decisions properly. 

Today, for many, these decisions boil down to whether we wish to be employed by an organisation or self-employed. In this guide, we look at four principal areas impacted by our choice of working type, and how they are impacted by each type of employment. 


While practically all of us are subject to the whims of the wider economy, does the risk of losing your income and job security differ between employees and the self-employed? Comparable statistics are notoriously difficult to find given the inherent variability in self-employed work, so there are arguments for choosing either camp. 

Both types of work can suffer due to poor economic conditions. However, you could argue that as a self-employed individual, it’s you that is ultimately responsible for ensuring a healthy pipeline of work, as opposed being an employee, where decisions on the future of the business are usually totally out of your hands. That said, a business might have larger cash reserves to weather economic storms. 

In the end, for both types of workers, it’s a good idea to build a strong emergency fund to ensure security, though we’d caution freelancers to save more, especially since gathering a roster of clients is arguably a tougher task than performing well at interview.


Looking at the economy before COVID hit, a TUC analysis showed that, in 2018, 49% of self-employed adults aged over 25 earned less than minimum wage – two million people overall. That compares to 441,000 employees, as noted in 2018 ONS figures. Other 2018 ONS data on the distribution of self-employed and employee income also shows that, on average, self-employed  people tend to earn less overall. 

That said, freelance earnings can vary considerably depending on the industry and specialism. If you are an expert in a niche, you may be able to command far higher fees than an employee would be paid. However, your work may fluctuate, affecting your overall income in kind. Employees don’t have to worry about this – barring promotion (or demotion), they can budget with more surety than self-employed individuals. 

It’s also important to note that self-employed workers must pay for their own specialist equipment and facilities. A plumber will have to occasionally purchase new hole saws, bits, and other tools; freelance digital marketers will have to purchase subscriptions to online reporting platforms; and bakers will need to absorb the costs of ingredients and apparatus. What’s more, tax and pensions are also paid out of pocket by freelancers. Employed individuals simply do not need to worry about these expenses. 


In a 2018 survey by AXA, 66% of people said they wished to become self-employed in order to gain a better work-life balance. It makes sense; in employment, we must work during the hours stated in our contact, and even taking time off is often subject to the holiday bookings of other staff.

Self-employed individuals are much less hamstrung. Yes, they may have client meetings and deadlines to work around, but ultimately, they are in complete control of their schedules. That means making time for care responsibilities, relaxation, or anything else, is much easier, as well as allowing us to work according to our natural rhythms, not the nine to five.


As a freelancer, your work is dictated by your experiences and knowledge. You can spend time learning new skills, but this comes at the sacrifice of paid work. 

In full-time employment, it can be much easier to develop your abilities. There is often a clearly delineated career path ahead of you, with specific milestones you must complete, often on company time, to get there. What’s more, you will likely work in a large organisation, which means many more opportunities to experience other roles and gain wider understanding.

It comes as no surprise, then, that the average age of UK freelancers is 48, according to the Association of Independent Professionals and the Self-Employed. It makes much more sense to work this way when your skills are well-developed already.

Your choice of work depends on your lifestyle, risk attitude, and skillset. Make sure to do your research on each option before you commit, so you can work happily and confidently.

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