Characteristics of the Self-Employed


With EMSI’s new data categories, we can now more closely parse data on the major classes of workers in the labor market. This is a significant shift in how we present employment data, and one of the valuable applications is being able to track and analyze self-employed workers — those whose primary job, their chief source of income, is working on their own.

In this piece, we’ll use EMSI’s self-employment data to dig into a segment of the workforce that has previously been hard (or impossible) to get at for local researchers and planners. But first, it’s important to distinguish between EMSI’s two proprietors datasets and why we’re only focusing here on the self-employed, the third of our four class of workers.

We also track what we call extended proprietors. This is distinct, miscellaneous set of workers/income earners, and the fourth category included for subscribers to our web-based labor market research tool. Extended proprietors do side gigs or earn income through a sole proprietorship or partnership, most often (but not always) in addition to their primary job. If surveyed, they would not list this extra work as their main source of income. On the other hand, our self-employed dataset uses the American Community Survey and other publicly available sources to track proprietors who work for their own unincorporated business, practice, or farm. (People with incorporated businesses are considered wage and salary workers for their own companies, and are thus not considered proprietors).

In short, EMSI’s self-employment data gives an estimate of the true self-employed in the workforce (i.e., those who are primarily self-employed and consider themselves as such). And it does so at the county, ZIP code, MSA, and state level.

A Note on Monitoring Entrepreneurial Activity

EMSI’s two new proprietor datasets offer a window into entrepreneurial activity for any level of geography, but we caution against labeling all workers in the self-employed or extended proprietor classes as entrepreneurs. More accurately, inside the extended proprietors dataset are those who pursue extra work opportunities while maintaining their day job, while the self-employed dataset includes those who have taken the additional step and are primarily on their own. Once start-up owners incorporate their business, they fall under the traditional wage and salary worker datasets.

Another thing to keep in mind: As you compare EMSI’s self-employment numbers at the national level with other sources, you might find higher estimates of the self-employed workforce than EMSI’s. The Current Population Survey, for example, tracks workers’ primary and secondary self-employment, while the ACS — which again is what EMSI uses — keeps tabs on only primary self-employment. A teacher who mows lawns in the summer could fall in the secondary self-employed category in the CPS, but for the purposes of EMSI data, that teacher’s lawn mowing would be found in extended proprietors because if you asked him what he does for a living, he would say teacher.


  • There are an estimated 10.6 million self-employed jobs in the US, a 14.4% increase from 2001. From 2006-2008, this group of workers declined nearly 5% before employment mostly leveled off.
  • Self-employed workers make on average $26,921 — more than half the annual average of the total workforce ($56,053).
  • The self-employed population includes a large segment of older workers. Over 30% (3.25 million workers) are 55 or older; this includes more than a million workers who are at least 65. Another 28.2% of self-employed workers are 45-54.
  • Nearly 20% of all self-employed jobs are in the construction industry. Another 15% are classified under “other services (except public administration),” which includes repair & maintenance, personal & laundry services, religious and civic organizations, and private households. The next-largest industry is professional, scientific, and technical services (11% of self-employed jobs).
  • The largest self-employed occupations in the US are child care workers (an estimated 556,523 jobs in 2012), carpenters (459,116 jobs), maids & housekeeping cleaners (441,551), farmers & ranchers (437,999), and construction laborers (380,226).

Note: The data in this post is from EMSI’s 2012.2 Class of Worker dataset.

Proportion of All Workers

Self-employed workers account for 7.1% of all U.S. workers, up from 6.4% in 2001. This percentage is lower that what the Current Population Survey reports, but again, we are looking at those who are primarily self-employed. Note that this proportion does not include peripheral proprietor activity through our extended proprietor dataset.

Among major sectors, the share of self-employed jobs is greatest in administrative and support services (particularly landscaping and janitorial services); agriculture, forestry, fishing and hunting; construction; and transportation and warehousing. In each of these sectors, 20% or more of the workforce is classified as self-employed.

As shown in the chart below, agriculture, forestry, fishing and hunting has made the biggest jump in the proportion of self-employed workers since 2001 (from 19.3% to 26%), followed by transportation and warehousing (16.2% to 20.2%).

While just over 10% of all jobs in the real estate industry are categorized as self-employed, nearly 70% of jobs (more than 5.5 million) in this sector are in the extended proprietors dataset. In this case, extended proprietors include part-time agents or people drawing income in a real estate partnership. The 11% in the self-employed category encompasses those who would list their real estate work as their main source of income.

Top and Bottom States for Self-Employed

Driven by a larger-than-average proportion of self-employed jobs in the arts and entertainment sector (as well as in forestry and logging), Vermont has the highest share of self-employment (11.6% of all workers) among all states and the District of Columbia. Maine (10.3%) and Montana (10.1%) are grouped closely together in the second and third spots, followed by California (9.7%), South Dakota (9%), and Idaho (9%).

By far the smallest share of self-employment is found in Washington, D.C. (2.1%), which is no surprise given that governments workers — regardless of the industry or agency — are considered wage and salary workers. After D.C., Delaware (4.4%), Virginia (5.4%), and New Jersey (5.4%) have the next-smallest shares.

The following table also shows 2001-2012 self-employment job growth and decline, and no state has expanded its self-employed workforce more than Arizona (36%). The growth of entrepreneurs has also been impressive in Texas (31%), Nevada (31%) and Florida (25%), while Nebraska has lost the largest percentage of self-employed workers (-11%, a loss of almost 9,000 jobs).

Since the heat of the recession in 2008, Vermont (8%) and Arizona (7%) have led the way in growth among the self-employed.

State Name 2012 Self-Employed Jobs 2001-2012 % Change 2012 Avg. Annual Wage Proportion of Self-Employed (2012) Rank
Source: Self-Employed - EMSI 2012.2 Class of Worker BETA
Vermont 41,529 15% $28,064 11.60% 1
Maine 69,533 6% $24,717 10.30% 2
Montana 49,910 -4% $25,834 10.10% 3
California 1,660,324 21% $28,851 9.70% 4
South Dakota 42,105 5% $27,093 9.00% 5 (tie)
Idaho 64,217 13% $24,718 9.00% 5 (tie)
Oregon 166,412 5% $25,820 8.90% 7
New Hampshire 59,565 9% $31,172 8.60% 8
Tennessee 245,723 15% $27,071 8.20% 9
New Mexico 73,347 9% $23,181 8.10% 10 (tie)
Colorado 209,822 16% $25,616 8.10% 10 (tie)
Alaska 30,459 1% $29,248 7.90% 12 (tie)
Arizona 215,044 36% $24,549 7.90% 12 (tie)
Texas 934,704 31% $27,079 7.70% 14
Wyoming 24,575 9% $28,311 7.60% 15 (tie)
Oklahoma 134,732 0% $24,850 7.60% 15 (tie)
Washington 251,891 18% $26,057 7.60% 15 (tie)
Hawaii 55,097 16% $28,896 7.60% 15 (tie)
Arkansas 97,671 8% $22,687 7.50% 19 (tie)
Iowa 124,166 5% $24,728 7.50% 19 (tie)
Florida 589,416 25% $23,508 7.20% 21
North Dakota 33,105 -4% $27,753 7.10% 22 (tie)
Kansas 106,887 9% $26,231 7.10% 22 (tie)
Connecticut 126,400 4% $32,882 7.00% 24
Nebraska 71,650 -11% $26,269 6.90% 25 (tie)
Rhode Island 34,567 18% $31,344 6.90% 25 (tie)
North Carolina 305,895 18% $24,667 6.80% 27 (tie)
Mississippi 84,600 5% $25,426 6.80% 27 (tie)
New York 644,061 13% $28,829 6.80% 27 (tie)
Minnesota 198,691 4% $25,460 6.70% 30 (tie)
Massachusetts 241,911 13% $31,106 6.70% 30 (tie)
Louisiana 143,407 17% $26,258 6.70% 30 (tie)
Missouri 196,695 8% $24,634 6.70% 30 (tie)
Georgia 288,876 13% $25,189 6.60% 34 (tie)
Alabama 137,245 14% $26,014 6.60% 34 (tie)
Michigan 284,673 12% $23,305 6.60% 34 (tie)
South Carolina 133,602 17% $24,769 6.50% 37
Kentucky 128,914 -1% $23,896 6.30% 38
Pennsylvania 378,801 8% $28,930 6.10% 39
West Virginia 47,775 3% $29,347 6.00% 40 (tie)
Wisconsin 176,142 -1% $24,811 6.00% 40 (tie)
Ohio 331,482 5% $25,331 6.00% 40 (tie)
Maryland 168,572 13% $29,691 5.90% 43
Indiana 178,485 7% $26,669 5.70% 44 (tie)
Nevada 70,034 31% $28,109 5.70% 44 (tie)
Illinois 353,135 12% $26,511 5.70% 44 (tie)
Utah 75,480 18% $25,027 5.60% 47
New Jersey 226,039 10% $32,994 5.40% 48 (tie)
Virginia 223,509 12% $26,574 5.40% 48 (tie)
Delaware 19,935 4% $28,018 4.40% 50
District of Columbia 16,680 13% $44,523 2.10% 51
Total 10,567,489 14% $26,921

A Look at MSAs

For the largest metropolitan statistical areas, Riverside, California has the highest percentage of self-employed workers (12.4%), followed by Los Angeles (10.5%). None of the other 30 largest MSAs has a double-digit presence of self-employed workers. Just missing that mark is Miami (9.7%), while San Francisco (9.3%) is also close.

New York City is right at the national average — 7.1% of its workforce is self-employed. Chicago is at 5.7%.

For all MSAs regardless of size, Guymon, OK (35.4%) and Rio Grande CIty-Roma, Texas (21.4%) have the largest percentage of self-employed workers. The lowest are Williston, North Dakota (2.6%) and Hinesville-Fort Stewart, Georgia (2.9%).


1. Recession’s Toll

There are almost 400,000 fewer self-employed jobs in the U.S. than in 2006, and the proportion of self-employed workers to the entire workforce is below pre-recession levels.

2. Highest-Paying Industries are Declining in Self-Employment

Of the 20 highest-paying industries with at least 100 self-employed jobs at the start of the recession, 17 have fewer self-employed workers in 2012 than in 2008. This includes offices of physicians and offices of dentists, both of which have declined 3%. Almost as pronounced is the drop in self-employment in legal services. In 2008, more than 214,000 self-employed jobs were classified under offices of lawyers; in 2012, it’s estimated to be 209,494, a 2% decline.

Meanwhile, the largest self-employed occupations tend to be lower-skilled, lower-paying jobs — construction laborers, child care workers, etc.

3. Older Americans are Working for Themselves

In 2009, Dane Stangler of the Kauffman Foundation wrote, “Contrary to popularly held assumptions, it turns out that over the past decade or so, the highest rate of entrepreneurial activity belongs to the 55-64 age group.” While our self-employed dataset does not solely contain entrepreneurs (see note above), EMSI data backs up Kauffman’s research. As we showed earlier, over 30% of all self-employed workers are over 55, and another 28% are 45-54.

4. Majority of Self-Employed are Men

Of the estimated 10.6 million self-employed jobs in the US, more than 6.6 million (63%) are held by men. This is in contrast to a much more even male/female breakdown (51% male/49% female) when we consider all wage and salary and self-employed jobs.

Joshua Wright is an editor at EMSI, an Idaho-based economics firm that provides data and analysis to workforce boards, economic development agencies, higher education institutions, and the private sector. He manages the EMSI blog and is a freelance journalist. Contact him here.

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