Why Are People Leaving Corporate America to Start Their Own Business?
In 2014 and 2015 the overall entrepreneur rate rose, and there was also a projected entrepreneurial boom for the U.S. last year. This rise in Americans venturing out on their own in business is one that has been gaining steady momentum for decades. In fact, since 1982 the number of small businesses has increased by 49 percent, and currently, 28 million small businesses in the U.S. account for more than 50 percent of all U.S. sales, providing 66 percent of all net new jobs since the 1970s.
While individual motives for starting a business may vary, below are the top reasons behind today’s U.S. employee leaving corporate America for entrepreneurship:
For a growing number of individuals, achieving a work-life balance is a high priority, yet often difficult to do in today’s culture of connectivity and increasing workloads. Unlike the standard nine to five, Monday through Friday schedule, entrepreneurs are able to be more present and available in their personal lives by working around a schedule that works for them. While this may mean later hours or more time put in one day versus the next, as long as the work gets done, entrepreneurs can give more attention to both their personal and professional commitments as necessary.
Financial Goals/Corporate Financial Peak
While starting a business may not guarantee success, an entrepreneur stands to grow his or her business with unlimited income potential with hard work and dedication. There is no cap to what an entrepreneur can earn, whereas executives have expressed concern about reaching their financial peak in corporate America. After years of climbing the corporate ladder, earning promotions and higher compensation along the way, they fear they have become unemployable after a certain amount of time. Other companies may be unwilling to meet or exceed their current salaries.
When companies downsize, high-earning employees may have few alternatives outside of entrepreneurship to continue making the same income.
Bureaucracy Burnout/No Appreciation
An overwhelming number of today’s employees feel little-to-no company loyalty on the part of their employers. They may dedicate themselves to a company for years only to have a new manager be brought in looking to make structural changes with no regard for the individual employee.
Another large majority of employees are not provided with paid sick days, vacation or personal time, while being expected to work more than the standard 40 hours a week without overtime compensation. These employees feel unappreciated at work due to an ever-growing workload without adequate acknowledgement for the time and effort put in.
Entrepreneurship is an attractive option, on the other hand, because individuals can see a direct result from their efforts, have the ability to achieve work-life balance and get a fundamental sense of accomplishment and fulfillment.
Lack of Purpose
Studies show employees want, and actually need, to feel a purpose for the work they do in order to remain engaged on the job. According to Gallup’s State of the American Workplace Report 2017, 51 percent of employees are actively looking for a new job or are keeping an eye out for openings. Just 33 percent of U.S. employees are engaged at work.
In addition to income, today’s employee wants to feel a higher purpose for what they do everyday. Entrepreneurs can start a business in a field they feel passionate about, knowing their dedication will not only improve their own lives, but make a difference in the lives of others, as well.
Many Winmark® franchisees are first time business owners, attracted to entrepreneurship for many of the reasons listed here. Through franchising, they note having the freedom to run their own business with the structure and support of a proven business model, taking much of the burden off the first-time entrepreneur. They can now enjoy a greater work-life balance while participating in an industry they shared a passion for as a customer first.
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