Self-employment snapshot: statistics and trends
 | February 28, 2025 | 10 min read |
For some, the structure of traditional employment provides comfort and stability. For others, the desire for greater autonomy and control over their careers drives them toward a different path: self-employment.
Compared to traditional work, self-employment is, in many ways, more of a lifestyle, providing an alternative means of earning income that combines independence, accountability and creativity. Even with its many benefits, self-employment comes with unique challenges. From managing all aspects of the business to staying competitive in an evolving marketplace, self-employed professionals must be strategic, resourceful and resilient.
In recent years, an increasing number of workers have been embracing the promise of freedom and flexibility that comes with self-employment, leading to a pronounced shift in our economic landscape. Today, Ooma is sharing the latest trends and statistics about self-employment, exploring its many facets and shedding light on the different dimensions of this constantly evolving and expanding career choice.
What is self-employment, and how does it work?
Simply put, self-employment is working for yourself. Unlike traditional employment, where workers receive a salary or wages from an employer, self-employed individuals get their income directly from their clients or customers. In the United States, approximately 1 in 10 workers are self-employed, but globally, the numbers are significantly higher, accounting for nearly half the workforce.
Common business structures for self-employment in the U.S. include:
- Sole Proprietorship: The simplest form of self-employment, in which the individual owns and operates the business personally
- Independent Contractor: An individual who works on a freelance or per-project basis
- Limited Liability Company (LLC): A state-regulated business structure that protects personal assets while maintaining flexibility in management and taxation
Self-employment entails managing business operations, securing clients, handling finances and navigating legal and tax requirements. But while all this added responsibility undoubtedly requires significant self-discipline and hard work, self-employed workers report lower stress levels and higher job satisfaction than their traditionally employed counterparts.
Self-employed workers are frequently found in fields such as skilled trades, writing, law and insurance. The most common industries for self-employment are professional and business services, construction, education and health services. Farmers, artists and property managers also commonly work for themselves.
The rise of self-employment since COVID-19
The COVID-19 pandemic significantly reshaped global work patterns, accelerating the adoption of remote work and prompting many individuals to reconsider their career paths. For many professionals dissatisfied with their careers, self-employment has emerged as a viable and attractive alternative to traditional employment, particularly for women and mothers of young children.
The pandemic economy has seen a marked rise in self-employment across a variety of industries. New technologies have made it easier to launch and sustain businesses, while the normalization of remote work has expanded opportunities for self-employed individuals to connect with clients worldwide.
However, the COVID era has also presented several challenges. Supply chain disruptions have plagued businesses, resulting in fluctuating economic conditions and increased competition that requires self-employed professionals to remain agile and innovative. But despite these hurdles, self-employment remains more common than it was before the pandemic, particularly in the personal services, recreation and entertainment industries and in transportation and communications roles.
Entrepreneurship: a cornerstone of self-employment
Entrepreneurship and self-employment are closely intertwined. While self-employment often involves managing a business as a sole operator, entrepreneurship extends to building and scaling enterprises with the potential for a broader impact. In the U.S., self-employment is the most common path to entrepreneurship.
The heart of entrepreneurship is innovation, which manifests in the entrepreneur providing a specific service or product to meet a market need not yet met. Over time, this focus can evolve into a larger business, complete with teams, infrastructure and expanded goals. Examples include a freelance graphic designer establishing a design agency or scaling a local service into a regional business. The top industries for entrepreneurship are food service, retail, business services, health and fitness, law, finance and insurance. Startup applications in 2022 surpassed pre-Great Recession levels for the first time, with many entrepreneurs listing inflation as the motivation for starting their businesses.
The role of side hustles and the gig economy
Side hustles have become a common entry point for self-employment, as they provide opportunities to explore new business ideas while maintaining the security of a traditional job. These secondary income streams, often facilitated by gig economy platforms, are highly attractive to those who can’t sustain a second job but need extra income.
High inflation and stagnant wages have made side hustles and gig work increasingly popular for certain members of the workforce. More than 50 percent of U.S. workers chose to start a side hustle to supplement their income in 2023, including nearly 70 percent of Gen Z and Millennials.
Popular side hustles include selling products on e-commerce platforms, freelancing and working for delivery and transportation services. The gig economy, supported by platforms like Upwork, Fiverr, Uber, Instacart and DoorDash, has democratized access to self-employment, enabling individuals to connect with clients and monetize their skills with minimal barriers to entry.
While side hustles are characteristically flexible, they also require disciplined time management and strategic planning, particularly for those balancing them with full-time employment. For some, gig work and side hustles provide a pathway to full-time self-employment once their ventures reach sufficient stability and profit. In 2024, the average side hustle earned workers an extra $900 of income a month.
Looking ahead
Self-employment is a unique and potentially enriching opportunity for workers to take control of their careers, and although it comes with financial risks and requires discipline, millions of workers find great satisfaction and creative freedom with the ability to work on their own terms. With its increasing prevalence among workers, self-employment is a significant part of the economy and a prominent force across many of the most vital industries. Self-employment is not just about earning a living; it is about building a life that reflects your values, ambitions and vision for the future. But whether you’re a small business owner or manage a larger team, you must stay connected with your clients. With our efficient, reliable and professional communication solutions, Ooma can provide you with the perfect plan tailored to your unique business needs.
30 statistics about self-employment
| Statistic | Details |
| General | |
| Approximately 10.1% of the total U.S. workforce is self-employed.1 | This number has trended upward since the COVID-19 pandemic began. |
| According to World Bank Group, 48.1% of the world’s working population in 2022 was self-employed.2 | |
| Job satisfaction is higher for self-employed workers in the U.S.1 | Nearly two-thirds (62%) of self-employed workers say they are extremely or very satisfied with their jobs, versus 51% of those who are not self-employed. They also tend to find work more enjoyable (65%) and fulfilling (65%). |
| Self-employed workers in the U.S. are less likely to be stressed and overwhelmed.1 | Self-employed workers report significantly lower rates of stress (15% vs. 29%) and feeling overwhelmed (8% vs. 19%) compared to those in traditional employment. |
| Of all self-employed workers in the U.S., 76% work full-time.1 | |
| At 6.4%, Florida is the U.S. state with the largest percentage of self-employed people in their own incorporated business.3 | |
| In 2023, the U.S. city with the highest percentage of self-employed workers was Hialeah, Florida, where 20.3% of workers are self-employed.4 | |
| In 2023, Miami, Florida, was the U.S. city with the highest percentage of female self-employed workers at 17.1%.4 | The United States average was 8.3%. |
| At an annual average of $60,221, North Dakota reported the highest self-employment income in 2022.5 | |
| Professional and business services (22.37%), construction (18.46%) and education and health services (11.45%) were the most common industries for self-employed workers in 2021.6 | |
| Freelancers contributed $1.27 trillion to the U.S. economy in 2023.7 | That is an impressive increase of 78% from the $715 billion reported in 2014. |
| Freelancers are 2.2 times more likely to use generative AI tools on a regular basis than non-freelance professionals.7 | That amounts to around 20% of freelancers using AI multiple times a week. |
| Farmers and ranchers, artists and property managers are among the most commonly self-employed workers.8 | Self-employed workers make up 70% of farmers/ranchers, 55% of artists and 40% of property and real estate managers. |
| In 2023, Amarillo, Texas, was the top-ranked U.S. city where the average self-employed worker earned more than the city’s median income.4 | That year, the self-employed in Amarillo earned an average income of $110,625, which was $63,213 more than the median income for all workers in Amarillo ($47,412). |
| The self-employment tax rate is 15.3%.9 | Social Security gets 12.4% of the self-employment tax, and 2.9% goes to Medicare. |
| In 2024, a significant majority of full-time independent workers (84%) reported being happier working on their own.10 | In addition, 79% reported independent work to be better for their overall health. |
| COVID-19 Pandemic | |
| In 2023, the level of incorporated self-employment remains about 7% higher than the pre-pandemic level.11 | That is approximately 400,000 more people than prior to the pandemic. |
| In 2023, industries that saw the biggest increase in self-employment since the pandemic started include personal services (4.5%), recreation/entertainment services (3.4%) and transportation/communications/other public utilities (1.5%).11 | |
| The percentage of self-employed women in 2022 grew faster than men when compared to the two years before the pandemic.11 | While self-employment rates increased overall during the pandemic, the 2022 increase was most noticeable in women (7.5% to 8.2%) versus men (12.1% to 12.4%). |
| In 2023, a higher percentage of self-employed women had a child under 6 at home, than those without children under 6 at home.11 | During the pandemic, the increase in self-employment among workers with young children at home was notably larger compared to those without, suggesting that childcare pressures created this shift. |
| Entrepreneurship | |
| Self-employment is the most common form of entrepreneurship in the United States.6 | The vast majority of small businesses in the U.S. (82%) in 2022 had no employees other than their founder. Among women-owned businesses, 90% are solopreneurs, nearly 10% higher than men-owned businesses. |
| Startup activity surged between 2022-2023, surpassing Great Recession levels for the first time.12 | Colorado had the largest surge in startup applications, increasing 116% from 2019 to 2023. |
| Fulton County, Georgia, had the largest percentage of growth in new businesses out of large U.S. counties.12 | Between 2019 and 2023, 21,200 new businesses were established in Fulton County, which contains Atlanta, an increase of 48%. |
| In 2022, 76% of one-person startups used their personal funds to handle financial challenges.13 | |
| Almost all Black-owned businesses (96%) have no employees other than the owner.6 | This is 15 percentage points higher than that of white-owned businesses. |
| Per capita, immigrants are around 80% more likely than U.S. born citizens to start a business.14 | Those immigrant-founded businesses have about 1% more employees than businesses founded by U.S. natives. |
| Inflation was the main motivator for wanting to start a new business in 2023.18 | According to a survey of more than 15,000 people seeking to start a new business, 66% stated that inflation—the need to boost income was their main motivator. The second-highest motivator was technology—45% believed that new tech makes it easier to start a new business. |
| At $144,941, Washington has the highest average salary for owners of small businesses.15 | |
| Side Hustles | |
| More than half (54%) of Americans started a side hustle to supplement their income between 2023 and 2024.16 | The study found that Gen Z is most likely to adopt a side gig (71%), with Millennials close behind (68%). |
| The average side-hustler brought home $891 extra per month in 2024.17 | That is 10% more than 2023’s per-month pay of $810, according to Ted Rossman, senior industry analyst at Bankrate. |
Sources:
- Pew Research Center — https://www.pewresearch.org/short-reads/2023/06/30/self-employed-people-in-the-us-are-more-likely-than-other-workers-to-be-highly-satisfied-with-their-jobs/
- World Bank Group — https://data.worldbank.org/indicator/SL.EMP.SELF.ZS?end=2021&most_recent_value_desc=true&start=2011&view=chart
- The Georgia Virtue — https://www.thegeorgiavirtue.com/georgia-news/georgia-has-the-ninth-most-self-employed-workers-according-to-new-research
- Chamber of Commerce — https://www.chamberofcommerce.org/cities-with-most-self-employed
- SideHustles.com — https://sidehustles.com/top-side-hustling-cities/
- Center for American Progress — https://www.americanprogress.org/article/understanding-the-self-employed-in-the-united-states/
- Upwork’s Freelance Forward Survey — https://investors.upwork.com/news-releases/news-release-details/upwork-study-finds-64-million-americans-freelanced-2023-adding
- Business News Daily — https://www.businessnewsdaily.com/8857-best-self-employed-jobs.html
- Internal Revenue Service — https://www.irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-and-medicare-taxes
- State of Independence in America 2024 — https://www.mbopartners.com/state-of-independence/
- Center for Economic Policy and Research (CEPR) — https://cepr.net/the-pandemic-and-self-employment-an-update/
- Center for American Progress — https://www.americanprogress.org/article/entrepreneurship-startups-and-business-formation-are-booming-across-the-u-s/
- Fed Small Business — https://www.fedsmallbusiness.org/reports/survey/2023/2023-report-on-nonemployer-firms
- Massachusetts Institute of Technology — https://news.mit.edu/2022/study-immigrants-more-likely-start-firms-create-jobs-0509
- ZipRecruiter — https://www.ziprecruiter.com/Salaries/What-Is-the-Average-Small-Business-Owner-Salary-by-State
- MarketWatch — https://www.marketwatch.com/guides/banking/side-hustles
- CNBC — https://www.cnbc.com/2024/07/16/side-hustlers-are-making-an-average-of-891-per-month-says-bankrate-report.html
- Quickbooks — https://quickbooks.intuit.com/r/small-business-data/new-business-insights-2023/
- Centre for Economic Policy Research (CEPR) — https://www.cepr.net/the-pandemic-rise-in-self-employment-who-is-working-for-themselves-now/
- HubSpot — https://blog.hubspot.com/sales/top-industries-for-entrepreneurs
Diane Balogh has more than 10 years of experience researching, editing and writing for and about the telecommunications industry. Her blog posts have appeared on ooma.com, TechBuzz.att.com, OnSIP.com and Talkatone.com. A graduate of the University of Missouri School of Journalism with an area of emphasis in science writing, she specializes in translating complex topics into language that is easy to understand.
