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Top 19 Pros and Cons of Employee Vs Entrepreneur


When we talk about an employee, an individual gets a guaranteed income, the risk involved in it is much less when compared to entrepreneur.

On the other hand, an entrepreneur has ample of opportunities to grow in aspects of their career.

There are many advantages of being self-employed also there is a question of financial security, business is purely dependent on the market, while we talk about an employee he/she receives an amount of salary as per the salary cycle.

The entrepreneur will have freedom for his ideas, policies and scope for exploitation. So let’s go through some pros and cons of an Employee Vs Entrepreneur.

Employee Vs Entrepreneur Pros Cons

Employee Vs Entrepreneur Pro’s:

Advantages of Employee:

1. Leave benefits:

The employers would provide certain leaves every year to each individual, where actually an employee can have time out.

They can have some refreshment reduce their stress levels and can again come back to their workplace with full of energy, also they can spend time on their personal tasks.

They do offer with different kinds of leaves as per their requirement and employee can utilize them. Also for certain employees, they get paid leaves one of the most interesting benefits.

For women employees, they do get maternity leaves, which can be used post and pre-maternity

2. Guaranteed Income:

Every month employee will receive fixed amount deposited into their accounts, unlike entrepreneurs they have financial security for their families.

The employer would pay for the employee for their services towards the organization, which includes a number of allowances, benefits, and contribution towards insurance, health plans and provident fund.

Not only the employee but his/her family also gets covered under health coverage plans. Even after getting retired they would get income and it gives a safe and secure feeling to their family, one need not worry about tomorrow.

3. Fixed working hours:

The employee would work for only fixed hours that has been agreed while joining the organization.

The employee will need to work extra hours only if it is needed, and the company will not have right to force to work beyond the extra hours, as per the requirement an individual can take a decision whether to spend time or not.

Also, they would get paid for doing over time or they would be compensated for contributing extra time for the organization.

So they do other tasks, once they are done with their professional time. They get a week off to spend time for themselves.

4. Work-Life balance:

One can concentrate much better on their personal life when compared to an entrepreneur. One dedicates their time for professional for about 8 – 9 hours.

Then they can switch to their personal life and balance them. They will even have leaves to enjoy with family.

One need not get to worry about work while at the home, they can complete their tasks at home. Also, while in the home they dedicate their sincere time for work.

Thus, they balance work and personal life and be able to live up to their responsibilities and can enjoy stress free life.

5. Less Responsibilities at profession:

One will be assigned a role and to be responsible only for that particular task assigned, it is less burden. The growth of an individual depends on upon the excellence proved in performing that task.

They need not worry how others are performing for the organization, he/she will get paid only for the work that is been assigned. Their focus is only one responsibility, so less burden at the profession.

The growth of individual depends on the appraisal cycle. They would have fixed incremental, so whether the task is completed or not, the employee would get his/her salary for the month.

Advantages of Entrepreneur:

1. Career Growth:

Choosing entrepreneurship will help to drive passion and fulfill the dreams of an individual. Every person aspires to become richer and choose a career of their own choice.

An entrepreneur can rule the business world, growth depends on the business one chooses and as per the market demand for their business.

If these factors are likely one can be a very successful person and there is a guarantee for their career. It provides a chance to develop vertically. One can create their own world of choice and be the leader for that kingdom

2. Independent:

An entrepreneur is independent to make his/her own decisions. No boss to command or dependent on someone to make decisions.

The employees would be working under them, and they follow the direction that has been set by their entrepreneur.

They just need to set up some standards and roles responsibilities for their employees, they would take care of everything and the entrepreneur can lead his life peacefully, he/she just need to approve and think of ways to develop.

An entrepreneur can choose his/her own way of doing business, they are not forced by anyone or dependent to step forward.

3. Flexible working hours:

Though the entrepreneur has more responsibilities, they can work at any time. Since everything will be managed by their peers, only the key and major responsibilities will be handled by the owner.

One can prefer their own schedule to work. There is no boss who commands to work for only fixed hours, this is no scenario that they would not get paid off if do not turn up for the work.

They can complete their personal tasks or can concentrate other professional tasks or meetings.

4. Liability to Earn:

The financial growth is what we expect from a professional career, entrepreneurship will provide a chance to grow economically.

One can earn as much they can, by making some process changes or strategy of their business they can affect the demand for their products and thus increase their sales which will directly affect the revenue of the organization.

Being an entrepreneur they would have a major percentage of share from their profits.

So the financial growth is much high for a self-employed person when compared to an employee. They can also increase their shares by investing in other ventures.

5. Scope to explore:

They get to see something new other than regular business. They get chance to meet different successful business magnets.

They face different challenging business scenarios. One gets the opportunity to understand each and every responsibility of employee working in their organization, they visualize a broad picture of how business is actually being done and face new customers and clients and get a chance to take partnership in other business commodities.

He/she have to lead the whole organization and the experience is totally new from being an employee. Also, have to motivate other peers in organization to work for common goals

Employee Vs Entrepreneur Cons:

Disadvantages of Employee:

1. Dependency:

An employee has to follow the instructions of the boss, they have no choice to oppose them. Sometimes they had to do tasks which make them pissed off.

If tried to turn it against, it will either effect the next appraisal or lead to termination. They do not have a freedom to make their own decisions or pitch their voice, unless until they are approved by boss they won’t be able to implement anything in the workplace.

Also have to show up on time and strictly follow the rules of HR, they cannot work any other time in a day as per their convenience.

2. Limited Income:

The annual income of the employee is fixed. Even he/she performed well during the certain time that is not going to increase their pay, may be can have some incentives for that period but over all pay will not increase.

As per the market norms, they get increments but will not get huge profits like an entrepreneur.

One may not be able to fulfill their needs of life with that amount, it may not be useful for full-time settlement of life. One need to keep on changing their organization to have better income.

3. Limited Scope to develop:

The scope that a person can develop or explore is very limited, he/she cannot have an opportunity to meet new responsibilities other than that was assigned.

They do have an opportunity to do something out of the box and deal with new responsibilities or understand the whole working standard procedure of his/her company. It kills the vision to learn new things.

They have fewer choices , they can only excel in only one responsibility. They cant be able to show their talent since the competition between the co-workers will be high and also sometimes get effected by the work place politics.

4. Job security:

It is a competitive world, so to sustain one should keep updating their skills and be able to prove to be a worth full resource for an organization.

One should follow all the rules and regulations of the company to make his/her job secure. Once the management sense, an employee is outdated they would not think to take that employee from the organization.

Also, they may choose to stop the growth of that employee. An individual do not have a chance to ignore their bad co-workers. They should smile and get along with them, even if they do not like to do it.

Disadvantages of Entrepreneurship:

1. Stressful to handle:

The entrepreneur is responsible for the whole business. The decisions taken by the leader will not affect his/her individual career and the employees being employed. They have a responsibility to sustain business in the market.

The burden on entrepreneur will be more, unless and until they build a good team to manage. One should be aware of each and every bit of the business involved, otherwise, it will create new legal issues to handle.

Especially for startup business, the pressure will be much high, it would require business experts to handle it in a better way.

2. Huge Investment:

To start a business one would require investment. So one has to explore sources for investment.

An entrepreneur should be capable enough to clear debts and make profits, otherwise, he would dip deep into debts and loss. The entrepreneur should be smart enough to generate revenue otherwise, they have to shut the business.

Every action of entrepreneur will affect the business. One should anticipate the future demand and invest on the products for their future growth.

It depends on his customer satisfaction if the consumers do not approve their products the entrepreneur will end up with the huge loss which cannot be recovered easily.

3. Long working hours:

Until the business is successful, the entrepreneur holds responsibility for improving business. They have to work hard to make changes in business in order to capture the market demand and able to serve the market with quality services.

One has to fetch new clients and keep working with them to expand the business. In performing these tasks one may have to forget their personal life to build up the business, one need to dedicate more time than his employees to achieve the results.

So being an entrepreneur one should be able to work for long hours which is a major hectic for self-employed.

4. Financial Instability:

When there is market demand the entrepreneur will enjoy the profits, if there is any fluctuation in demand or supply the entrepreneur will not get paid.

When there is market demand the entrepreneur will enjoy the profits, if there is any fluctuation in demand or supply the entrepreneur will not get paid.

He has to pay for his employees, taxes and other utility bills and rents etc. So there is a risk of economic instability being an entrepreneur, there is a pressure to at least pay his dependants while business at loss.

One does not have a chance to escape from these responsibilities, to get profits one should always be at profits or at least should earn the invested amount.

5. Risky:

There is no guarantee for his career. There is a high possibility to face hiccups. A single decision can change everything, and lead to loss of funds that is invested.

If the organization failed to meet the targets then the place will be occupied by some other organization. Should always be ready with new strategies to cope with competition.

A bad planning can land the business into economic depletion. The entrepreneur should always be capable of taking few risks to develop his business.