Does Owning a Small Business Make People Happier?

Small businesses have accounted for approximately 65 percent of new private sector jobs over the past 15 years, according to the U.S. Small Business Administration. Owning a small business is often seen as a challenging, but rewarding experience, sentiments that are confirmed by a new poll conducted by Environics Research for TD Bank. According to the press release:

A remarkable 69 percent of American small business owners polled for the TD Small Business Happiness Index would describe themselves as "very happy," with 61 percent believing they are happier than their peers. Furthermore, the pressures of the recent recession have not deterred small business owners from entrepreneurship, as 87 percent say that five years from now, they're likely to still be running their own business.

TD Bank's survey — which explored the attitudes and behaviors of North American small business owners in a dozen metropolitan areas across the United States and Canada — further revealed that nearly 9 in 10 American small business owners are happier owning and running their own business as compared with working for someone else. However, the sense of pride and accomplishment they derive as small business owners is paired with a deep commitment to the office, as the majority work 50 or more hours each week, with 39 percent saying they work 60 hours or more.…

There are several reasons for small business owners' high satisfaction levels. American small business owners say that owning a small business gives them a sense of pride and accomplishment (97 percent) plus a strong personal connection to their employees (94 percent) and their customers (88 percent). In addition, 82 percent say that owning a small business gives them the opportunity to volunteer their time or make donations to charities, sports teams and events.

The study would have been more useful, however, if it had polled employees in other sectors to provide some basis for comparison. "Only small business owners were surveyed for the release. We have not surveyed any public sector workers for comparison," wrote Jennifer Morneau, a spokesperson for TD Bank, in an e-mail. "We are however working on a survey of corporate businesses, but we don’t have results back yet."

It would also have been nice to see the entire poll, but TD refused our request for a copy.

More from Reason on how the free enterprise system leads to better outcomes here, here, and here. Also be sure to check out a recent series of reports released by the Institute for Justice, which look at the plight of five different entrepreneurs and their struggles to create successful small businesses in the face of restrictive government regulations.

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  • Some Guy||

    Kind of like getting married or having kids, owning a business can cause tons of stress, but can also be well worth it.

    Of course there's going to be some self-selection involved, as well, because people have to be pretty motivated and presumably happy with what they plan to do in order to start a business to begin with. I wonder if they compared new small business owners vs. those who had been doing it for various intervals of time.

  • West Texas Boy||

    So just now before I clicked over here, I was literally just now wrestling with some state tax forms and caught myself thinking, "man, owning a business sucks..."

    Then I slapped myself and realized that no, it doesn't. I think I would wither away if I had to go back to a cubicle and my own pointy haired boss.

    It's good to be the king. Even if I don't make very much money (yet).

    (I can only imagine how nice it would be if there was less of a tax burden and it was easier hire people.)

  • emmajane||

    I saw a sign in a store in Montana last week: "The only thing more painful than natural childbirth is owning a small business".

  • TallDave||

    I would say its more self-selection than self-satisfaction -- I have to think the number of depressed, pessimistic people who start businesses is very small.

  • WTF||

    Although I will say that I and several friends of mine are depressed and miserable precisely because we work for a big firm, and we would love to start our own businesses. We're not pessimistic - other than with regard to working where we currently do.

    Some people are motivated to start small businesses by being miserable in their situation working for someone else.

  • Chad||

    I was thinking the same thing, Dave.

    You have selection happening on both ends. Not only will unhappy people probably not be the type to start businesses, those people who are STILL running a business today (as opposed to a few years ago) have a lot to be thankful for. I doubt a lot of recently-failed small-business owners were interviewed.

    We have to be careful when we talk about "small businesses", though. The usual definition includes up to 500-person companies, which are hardly small in my mind. They also include franchises. And does anyone know about subsidiaries of larger corporations? Who exactly decides which organizations count as a "small business".

  • ||

    Who are you, and what have you done with Chad?

  • The Gobbler||

    "And does anyone know about subsidiaries of larger corporations?"

    They are known as Business Units or Operating Companies, not small businesses.

  • The Libertarian Guy||

    Jesus, Chad... you hate big business, you hate small business... what the fuck makes you happy?

  • Jordan||

    Running other people's lives.

  • slayer of cheese||

    As much as Chad deserves all the ire that is aimed in his direction, how does that comment equate to "hate"?

  • The Libertarian Guy||

    Not that comment, specifically, but he has bared his store-bought fangs over the eeevuls of capitalism once or twice.

  • TallDave||

    It would also have been nice to see the entire poll, but TD refused our request for a copy.

    Blatantly untrue, I was never asked.

  • ||

    I work for a startup, and though the hours can be brutal, the fact that we can act like the monkey house at the zoo half the time is really fun. It's so much better than working for a large company with fears of workplace lawsuits.

    I mean, can people working at Microsoft sneak up behind their fellow employees and hit them with foam nun-chucks as hard as possible? I don't think so. But we can, and do daily.

  • T||

    Good lord. My safety manager would have an apoplectic fit if we did that here.

  • ||

    How about throwing Nerf darts everywhere constantly or making ape noises when we have to do grunt work?

  • ||

    A company where apes evolved from men?

  • ||

    You got me; I work for DEVO, Inc.

  • ||

    Are you not men?

  • ||

    It's all fun and games until you take a Nerf arrow in the eye.

  • bohica||

    Then it's a sport!

  • dfd||

    Meh, wimps. We use old-skool Lawn Darts around here.

  • ||

    Sounds like you'd be even happier running a day care center or driving a school bus. I would say zookeeper, but my brother has that job and says it's not as glamorous as you'd think.

  • ||

    I mean, can people working at Microsoft who aren't Bill Gates sneak up behind their fellow employees and hit them with foam nun-chucks as hard as possible? I don't think so.

  • ||

    Bill no longer works for Microsoft. And besides, Paul Allen was always the nun-chuck type.

  • ||

    With his own space program. Man, I want to be super rich with my own space program.

  • ||

    Bone and Cillian Rail huh? That is one classy business card.

  • ||

    It certainly should, its nice to be your own boss.

    Lou
    www.anonymous-surfing.es.tc

  • The Gobbler||

    For whom do you work, Hammy?

  • ||

    "Small businesses have accounted for approximately 65 percent of new private sector jobs over the past 15 years, according to the U.S. Small Business Administration."

    That doesn't fit in with my preconceptions so it can't be true.

    Job growth comes from the government, and taxing capital gains as ordinary income makes that happen. I know because Barack Obama call it "investment".

    ...and besides, it fits in with my preconceptions so it must be true.

  • ||

    You seem to have missed the "private sector" qualifier in that quote. I would think that a large majority of the new jobs created in the past five years are in the public sector (which is not a good thing).

  • Chad||

    I wonder what percent of good jobs were created by small businesses.

    "Assistant night manager" at Wendy's does not count.

  • West Texas Boy||

    Goddamn, you are a stupid fucking ignorant naive prick.

  • The Libertarian Guy||

    Chad is the type who gets moist over the creation of government jobs, not getting the irony of cheerleading for Big Business when said business is government.

  • KPres||

    "Assistant night manager" at Wendy's does not count.

    True. The assistant night manager actually has to work. A good job is "Interstate Construction Worker," which pays 20% higher than the going rate for labor, and only requires 30 minutes of real, actual work per day, with the other 7 1/2 spent leaning on your shovel watching somebody else work.

  • Corduroy||

    Used to work for a small to mid-cap size corporation, now own a small biz. I much prefer the latter, there really is no comparison. However, the current economy and gov't intrusion really does contribute to my gray hair count.

  • Obama Administration||

    That is our plan.

  • Coeus||

    I'm thinking that this can be mostly explained by the lack of both a dress code and corporate administered drug tests.

  • Greer||

    I'll say that running a business can be a pain in the ass- unlike employees, you actually have to MAKE your money. And if business drys up, you don't have money to pay the bills.

    But about once a month I think how lucky I am that I don't have to drive to work, I don't have a small cubicle, I don't have people tell me that I have a "case of the Mondays"*, I don't receive memoes from HR, I can leave when I want and arrrive when I want and can even drink beer at 4 in the PM (only on Tueday in late July though) if I want. It's then that I feel lucky and realize how good I have it.

    The day I quit my job was one of the happiest days of my life.

    *["Does anyone ever ask you if you have a case of the Mondays?"
    "Hell no, what? Fuck no, we'd kick somebody's ass if he said that"]

  • West Texas Boy||

    But about once a month I think how lucky I am that I don't have to drive to work, I don't have a small cubicle, I don't have people tell me that I have a "case of the Mondays"*, I don't receive memoes from HR, I can leave when I want and arrrive when I want and can even drink beer at 4 in the PM (only on Tueday in late July though) if I want. It's then that I feel lucky and realize how good I have it.

    Amen, brother.

  • Greer||

    I should explain that the reason I was drinking beer at 4pm this afternoon, is because I worked every day last week, 9am-11pm. I finished the big job yesterday so felt I could take it easy today. It doesn't always work out like that, but sometimes you can call your own shots.

  • Rhywun||

    I'm enormously respectful of small-business owners -- more so because I am aware of my capabilities and I know I could never, ever hack it. Being a 9-5 drone suits me pretty well despite the well-known drawbacks. I do have to say I greatly prefer WORKING for a small business over a large one. My present company has gone from 60 workers to 1000+ in my ten years there, but it's kept some of the old charms like no ties, no drug tests, and such. Sure I fantasize about "being my own boss" but it's sure not for everyone.

  • Twayne||

    15 years here. Just me and my wife and a small business in the midwest. Not rich by any means, but more than getting by. It is there if you are willing to bust your ass for it, even in this economy. I put in about 70 hrs a week or more, but I'm still doing something I like to do! I would consider myself "happy". I can't imagine doing anything else, I do what I want, when I want (even though I work late). Gov. does make it a pain in the ass for small bus. to employ people. It seems like you are better off to expand with 10 people and an HR department, because it is just as much of a paper circus to hire one or two people.

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