September's Labor Review Monthly from the BLS has an excellent article on U.S. self-employment.
One of the most interesting charts is shown below. It shows that the percentage of unicorporated self-employed that have paid employees has fallen consistently over the last decade.
It comes as no surprise that the self-employed are using fewer paid employees. Companies of all sizes are increasing their use of contingent workers - contractors, part-timers, freelancers, etc. - to improve workforce flexibility and save money. They are also automating tasks that used to require employees.
The shift towards contingent workers will have far reaching impacts - both positive and negative - on business and society over the next decade. This will also be a contintious issue, with government, big labor and many newly contingent workers opposing this shift.
The growth of contingent workers will:
- Provide more part-time and freelance job opportunities for older workers not ready for traditional retirement
- Shift where and how we work, with the home and 3rd places like coworking facilities becoming more important work places.
- Reduce employment security.
- Shift health care, retirement planning and other risks to the individual.
- Lower the costs of starting and operating a small business.
- Increase small business flexibility and agility, making it easier to serve niche markets.
- Change the social contract between businesses and employees - both full time and contingent.
These trends are covered in more detail the Intuit 2020 Report.
Click here or refer to the article for information on unincorporated versus incorporated self-employment.