Self-employed older workers 'take financial hit but have better life quality'
Older workers who leave their jobs to become self-employed find the improved quality of life is enough to accept a significant drop in income, a report has said.
The study found over 50s who became their own boss were able to better control the amount of work they were doing and its pace, and to be more flexible in realising their own work-life balance.
These benefits of switching to entrepreneurship, along with increased levels of control and autonomy, were enough to compensate for a loss of income.
Professor Teemu Kautonen of Anglia Ruskin University compiled the report alongside colleagues from Syracuse University in America and Aalto University in Finland.
The authors examined data from the English Longitudinal Study of Ageing to see how older workers' levels of income and quality of life changed in response to a career transition, either to a new job or from paid employment to self-employment.
They sought to examine the benefits of late-career entrepreneurship, which is promoted by policy-makers as one of the measures to tackle the challenges of an ageing population.
"This study suggests that promoting late-career switches to entrepreneurship is not only fulfilling for the individual, but socially sustainable," said Mr Kautonen, who is Professor of Enterprise and Innovation at Anglia Ruskin.
"The ageing of the world population will be one of the greatest challenges in the coming decade and evidence suggests that not only are self-employed people likely to work for longer and therefore contribute to the system rather than depend on it, but they will get more satisfaction out of doing so.
"It is true that people switching to entrepreneurship will often take a financial hit, but these results show that the increase in the quality of life more than makes up for this."
The research is published in The Journal Of Business Venturing.