Academic journal article American Journal of Entrepreneurship

Does Working for Oneself, Not Others, Improve Older Adults' Health? an Investigation on Health Impact of Self-Employment

Academic journal article American Journal of Entrepreneurship

Does Working for Oneself, Not Others, Improve Older Adults' Health? an Investigation on Health Impact of Self-Employment

Article excerpt

(ProQuest: ... denotes formulae omitted.)

Introduction

Self-Employment: An Increasingly Popular Alternative to Retirement in Later Life

Despite the collision of the recent large-scale economic downturn and the entrance of the first baby boomer cohort into wage-and-salary retirement ages, self-employment rates among older adults continue to be an important alternative to retirement in later life (Cahill, Giandrea, & Quinn, 2013). The prevalence of self- employment increases substantially with age, both because self-employed people work longer and many wage-and-salary2 workers, i.e. those working for others, turn to selfemployment in later life. In fact, approximately 18% of employed persons over age 65 are self-employed (Hippie, 2010).

Outside of those who arrive in later life as self-employed individuals, people become self-employed in later life in response to both "push" and "pull" mechanisms (Zhang, 2008). With regard to "pull" mechanisms, older people may find the opportunity for a flexible work schedule attractive due to the ability to balance work-life with other activities that are important during the early stages of later life such as self-care, volunteering, caregiving, or leisure activities. In this way, self-employment provides a model of employment that facilitates greater control and flexibility (Zhang, 2008). As explained by socio-emotional selectivity theory (Carstensen, 1992), as people age, their focus tends to change from career and family goals, to opportunities that allow them to focus on emotionally meaningful activities. Thus, self-employment itself may be a meaningful way for some to participate in economic activities, but it may also offer the flexibility to mix paid work with other unpaid meaningful activities.

With regard to "push" mechanisms, as described by Zhang (2008), selfemployment may be a choice for older workers who need to remain employed when wage-and-salary positions are not available or who feel their jobs no longer effectively utilize their human capital. Older workers' employment situations are tenuous in times of economic uncertainty, in part because their salaries are higher and perceptions that they are less able to learn new skills. Coupled with factors associated with age discrimination, Lavarreda, Snyder, & Brown (2013) suggest that older workers were hit harder by the recent economic downturn than any other age group. Rather than being pushed out of the labor force completely, when faced with difficult options, some older workers choose self-employment.

As for the "pull" mechanisms, according to Zhang (2008), many seniors would like to continue to fulfill their life by making good use of their invaluable human capital and wisdom. After working numerous years in life, seniors have accumulated abundant working experience, management skills, wisdom, networks and business ties, and they tend to be more ethical and loyal. Seniors also have better language skills. Human capital is the driver for our current economy, the knowledge economy. In this context, seniors with skills and human capital are a particularly valuable asset to our economy. Regardless of the "push" or "pull" mechanisms that lead to self-employment, self-employment could provide a way for older people to utilize their human capital to produce income for thenown needs and benefit the overall economy (Zhang, 2008).

The Influence of Health on Employment in Later Life

A strong base of research has begun to unravel the complex factors that influence the relationship between working and health. A broad base of research describes how older adults' health impacts employment status (Lindeboom and Kerkhofs, 2009), the health benefit of retirement (Singh, 2006; Litwin & Shiovitz-Ezra, 2006), the negative health impact of retirement (Drentea, 2007), the benefit of bridge employment versus retirement on health (Zhan et. al, 2009), and the health impact of occupational choice (Quinn, 1980), including the propensity of being self-employed (Zhang 2008). …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.