It’s time to dispel the myth that entrepreneurs are purely in it for the money.
While significant financial gain could be a big payoff of pursuing entrepreneurship for a select few high-scale entrepreneurs, a need to fulfill a sense of engagement in one’s work leads some to start up.
A Gallup poll found that only 13 percent of employees worldwide are engaged in their jobs. That leaves 87 percent of workers reporting they are ‘not engaged’ or ‘actively disengaged’ and are emotionally disconnected from their workplaces, making them less likely to be productive, according to the report.
In the United States, 30 percent of workers are engaged in their jobs, 52 percent are not engaged, and 18 percent are actively disengaged. While we seem to be faring better than the rest of the world in terms of job engagement, engaged workers represent one-third the size of our disengaged co-workers.
This research has been resonating with me lately since our Research & Policy team hosted Innovation for Jobs (I4J) CEO David Nordfors last month. Nordfors has devoted his work to this idea that a more engaged workforce, with people pursing their unique talents and passions, would create a more innovative and productive workforce.
Nordfors wants to know what this world would look like if everyone got to do a job that they love every day. How would the way we think about jobs change? How would workforce productivity be affected?
Nordfors notes that right now we live in a task-centered economy. We are hired to do a task, and the task is our responsibility at our job. Our titles are reflective of the task that we do. Server. Researcher. Programmer. Dry cleaner. Any myriad of labels.
He challenges us to think of a people-centered economy: An economy where we are hired for a job based on our talents and personality, leading to a more innovative and creative economy. Jobs that are created based on who we are.
When people are at jobs that are in line with the values they hold and the talents they have, they will add more value to a business. This also seems to be a primary determinant of why certain individuals choose entrepreneurship.
In a previous post I noted that the brightest talent chooses to leave a firm to explore entrepreneurship regardless of pecuniary and non-pecuniary compensation provided by their employer-firm. They select entrepreneurship for the purpose of putting their talents to what they believe is of the most value.
Further research has expressed that the most common reason to become an entrepreneur is for the personal value-driven rewards entrepreneurship provides.
In a study by Kauffman Emerging Scholars Erik Hurst (University of Chicago) and Benjamin Pugsley (Federal Reserve Bank of New York), the two explore the non-pecuniary benefits of small business ownership. Their research finds that the number one reason individuals start a small business is for non-pecuniary benefits: “Of these new business owners, over 50 percent of them reported that non pecuniary benefits were the primary reason as to why they started their business.”
These non-pecuniary benefits include: being one’s own boss, flexibility over one’s schedule, ability to work from home, enjoying the work, and viewing the business as a hobby. Their research finds that this remains constant regardless of firm industry.
These intangible benefits are prevalent throughout all forms of entrepreneurship. As individuals decide to move from wage employment to entrepreneurship, research explains that their lifetime earnings fall.
Even so, entrepreneurs still choose to leave wage-work behind to start their own business. I believe this further suggests that the reasons for pursuing entrepreneurship are above all, personal value alignment, where values are fulfilled in part through work engagement.
Not all business ownership creates this kind of passion-driven job engagement, though. Perhaps a dry cleaner or bodega owner is not fully engaged in his or her work, but the other aforementioned non-pecuniary benefits create an important value for their life outside of the heart of job engagement.
Those of us who love what we do and feel engaged at work are statistical outliers. Nordfors’ advice is to invest in a people-centered economy where jobs are defined by unique skills and talents, aligned with the value of an individual.
In accordance with his advice, it’s important to continue to strive to find new ways for individuals to be at jobs where they feel high engagement. In doing so we will see a more productive and innovative workforce.
Realistically, today’s society is not structured in a way for everyone to be an innovator. We are not all fortunate to be working at a job that will fulfill our values and passions. However, for some, entrepreneurship can be the answer.
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