Question

1. Outline the disadvantages of self employment.

2. Outline the advantages of wage employment.

3. Outline the disadvantages of wage employment.

Answer 1

1) Self Employment refers to the type of employment in which person works himself without being under any employer. He is his own boss and takes all the business decisions on his own.

Some of the Disadvantages of Self Employment are:

i) More burden of Work : If a person owns a business and has to operate it single handedly then it puts more burden on his as he has to look after all the financial requirements to operate the business and has to ensure that he earns adequate profits at the same time.

ii) Unsteady Pay : In case of Self employment the person is not guaranteed steady pay as in case of wage employment. The harder a person works the more he can earn, so in case of self employment the pay fluctuates as per the work.

iii) Funds for Investment : Self Employed person has to invest funds before he can start his business. So the amount required varies with the type of business. More investment is required for operating business on large scale which is not required in case if we are wage employed .

2) Wage Employment refers to the type of employment in which one works for other person while getting paid fixed wages.

Advantages of Wage Employment:

i) Fixed pay : In case of wage employment the person gets fixed pay for the works that he carries out after being employed. There is no fluctuation in pay as in case if the person is self employed.

ii) Additional Benefits : There are several benefits that are provided by the employers these days to attract employees which includes medical insurance, family insurance, etc which can be beneficial for the person.

iii) Skills Enhancement : Person being employed under an employer work in the field of their specialization on day to day basis which increases their knowledge and enhances their skills.

3) Disadvantages of Wage Employment :

i) No share in Profits : One of the main disadvantages of wage employment are that the profits earned by the organization go to the owners and the employees get nothing for the hard work that they put into work.

ii) Less Security of work : In case a person is employed under an employer and there may be situation where the work availability is less and the employer may ask the employee to resign from the post where he is working. So the security of work is less in case of wage employment

iii) Regular reporting to the owners or managers : While being wage employed , the performance of work done is reported from time to time and in case if the performance dips due to some reasons this can lead to loss of work as well.

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