Employment vs Entrepreneurship: Choosing the Right Path

Deciding on a career path can be one of the most important choices you make in your life. A career that you are not only successful in, but also enjoy doing will affect all aspects of your life in a positive way. But do we explore all the options before making a decision?

The average Canadian will switch career paths several times within their lifetime for various reasons. But when making the choice, it’s important to consider all the different factors that play out in a career, including job security, financial stability, and the Canadian job market.

Employee vs Entrepreneur: Definition

One question that may get ignored by many people looking to start a new career, or simply entering the job market for the first time, is whether or not they want to be an entrepreneur or an employee. In fact, most people struggle with the difference between the two because they only saw employment as the choice that was available for them. We are often encouraged to find a great job, and many of us don’t think about creating our own employment by becoming a business owner. Knowing the difference between employment and business mindset is crucial to understanding which option would work better for you as an individual, and how being an employee or a business owner can suit your own personality and goals.

The technical definition of an entrepreneur is someone who “undertakes an enterprise.” An entrepreneur is someone who starts a new organization – a business, or takes on an existing organization with the intent to revitalize it. Entrepreneurship most commonly manifests in the form of self-employment.

One of the biggest differences between self-employment and employment is having more control.

Employment is a relationship between two parties, usually based on a contract – one being an employer and the other being an employee. The employee will contribute labour and expertise to an endeavor for the employer and is usually hired to preform specific duties which are packaged into a job. In this case, the employee has less freedom over their time and earnings, as it is set by the employer and the organization they are working with.

On the other hand, being self-employed means having more freedom in deciding the workload and work hours, as well as having less supervision in terms of how the work is done. If you are working as a contractor or an independent service provider, you have the opportunity to decide what clients you want to take on, when you work, and how you and your future organization (if you decide to expand your business practice) operate.

Of course, being self-employed is not that simple. Once aspect that differentiates entrepreneurship and employment is the amount of risk incurred. An employee has a relatively low amount of risk. In most situations, the employee is only responsible for his/her work responsibilities during the designated business hours, and they are often entitled to certain benefits from the organization. This form of employment is ideal for an individual who wants a higher degree of stability and predictability within for their career.

Being an entrepreneur means taking on a challenge and working hard to get through it. “Getting a new career or building a business is never easy, and not everybody will support you in your journey,” shares Bill Murray, an independent financial planner. And he is right: with any business venture, it takes a while to gain the knowledge, establish yourself as a business owner, and gain the reputation to attract the clients. “It can be a long process. They say every business needs at least 2-5 years to grow and prosper and start getting significant return on investments; and I’m talking about 2-5 years of dedication and hard work,” adds Bill. “But to be honest with you, the results are worth the struggle.”

Entrepreneurship: Is it for you?

For those who are driven, who want to take on a challenge, want more control of their time and money, and thrive in the excitement of building their own future, taking the entrepreneurial path may be the best choice.

But be prepared: as an entrepreneur you will be responsible for all of the financial costs of the organization, for marketing and promoting yourself, and for gaining your clientele. Entrepreneurs’ days don’t go from 9am till 5pm, and they are always working on ways to improve their organization. In addition, the entrepreneur can also be held legally liable for the organization, which is a personal risk, as well as a business risk.

However, you must not let these risks make you apprehensive towards taking the entrepreneurial path. There are many organizations and programs in place to help the entrepreneur start their journey, including different government agencies and NGOs. Canada is especially invested in helping entrepreneurs and encourage them on their path to success.

Another important aspect of successful entrepreneurship is mentorship. Having someone in the field who can teach you and guide you through the needs and responsibilities of the industry is incredibly important. So don’t be afraid to join various networking events, or to pursue employment in the field first, before venturing out on your own.

One more tip to becoming a successful entrepreneur is to be properly educated. A strong educational foundation is good for any career, whether you would prefer to just be an employee or start your own business.

Studying can help you be more knowledgeable and more confident in your field, while having the practical skills and certifications in your industry will help you gain credibility and stand out among other self-starters.

Whichever route you pursue, make sure you do your due diligence and research all the different options and opportunities available for you.