3 - SMALL BUSINESS IS OLDER (SENIOR ENTREPRENEURS)

A disproportionate share of the self-employed in the United States are middle-aged and older workers. Although many older workers have heen self-employed for much or all of their working lives, some move into self-employment later in their careers, often as a planned part of the retirement process.

Self-employment

rates are consistently higher among older workers than the workforce as a whole. In 2002, for example, the rate of self-employment for the workforce as a whole was 10.2% (13.8 million workers), but the rate for workers aged 50-plus was 16.4% (5.6 million workers). Although those age 50 and above made up 25% of the workforce in 2002, they comprised 40% of the self-employed.

So finds a recent research report, "Self-Employment and the 50+ Population," conducted for the AARP by Rand Corp. researchers Lynn A. Karoly and ju lie Zissimopoulos. As reported in the Wall Street Journal, the number of self-employed older workers has been inching up for several years, even as the overall number of self-employed Americans has declined. It is a trend that AARP expects to accelerate after finding in a poll last summer that many people plan to keep working into their 70s or even later, and that 16% plan to work for themselves or start their own business.

The study also shows that the proportion of self-employed workers rises with typical working age, peaking at 24% of working women at age 66 and 38% of working men at age 65. The numbers reflect that people are doing this as a transition to retirement, or they tend to be working longer than those who are in wage-and-salary jobs.

Growth Strategies Implications

The report provides signs of what retirement in the US might look like in the coming decades. The sheer number of baby boomers headed into what are traditionally retirement years, but with the need, desire, ability and opportunity to continue working, will likely propel this trend for decades to come.