New research from Trinity Business School in Dublin, Ireland highlights the need for employers to be mindful of the financial wellbeing of freelancers and contractors. This is particularly relevant given that some suggest 75% of staff could be gig workers in 5 years.
According to the research, authored by Dr Martha O’Hagan-Luff, Assistant Professor in Finance at Trinity Business School, alongside fellow Trinity academics, Dr Jenny Berrill and Dr André Van Stel, and Dr Damien Cassells from Technological University Dublin, financial problems are more strongly associated with lower levels of wellbeing for those that are self-employed.
The study compared how the relationship between financial distress and wellbeing differed between those in employment and the self-employed. It revealed a greater negative association between financial troubles and the overall health and life satisfaction of the solo self-employed compared to wage-earning employees.
It was also revealed that a negative impact on mental health and quality of life was most pronounced in the self-employed who themselves had employees.
In undertaking the research, the academics used data from the Survey of Health, Ageing and Retirement in Europe (SHARE) database, a European dataset of wage-employed and self-employed workers aged 50 and over.
The study draws on four measures of wellbeing – overall health, mental health, life satisfaction and quality of life. In this way it offers large-scale evidence of the relationship between financial distress and wellbeing and how this relationship may differ between different types of income and self-employment.
Martha O’Hagan-Luff, Assistant Professor in Finance at Trinity Business School, said:
“The findings of our study are particularly relevant during crisis periods such as during the Covid pandemic, demonstrating the importance of providing adequate financial support for the self-employed.
You can access the full report here: The relationship between financial distress and well-being: Exploring the role of self-employment
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