Why is interest among professionals to be self-employed on the wane?

Is interest among the UAE professionals for being self-employed on the wane? A comparison between two surveys held in 2020 and 2021 shows that there is a tangible decline in professionals’ preference for self-employment.

According to the latest survey, only almost two-thirds (62 per cent) of UAE residents prefer to be either self-employed or have their own business if given the choice.

In the 2020 survey, seven out of ten (70 per cent) UAE residents preferred to be self-employed or have their own business. Even those who are employed, 64 per cent were thinking of starting a business, 23 per cent of respondents tried to start their own business in the past, while only four per cent had never given it a thought.

According to employment professionals, this declining preference for being self-employed is due to the uncertainty in the overall business environment still persisting even a year after the outbreak of the pandemic. “The situation remains cloudy with hardly any sign of an end to the persisting challenges and setbacks caused by the Covid-19 pandemic, denting confidence among professionals to be self-employed as it is less assuring than the stability and comfort of a permanent job,” a job consultant said.

This year’s survey conducted by job site Bayt.com, and market research agency, YouGov also found that personal fulfillment (53 per cent) and freedom to choose work-life balance (46 per cent) emerge as the top reasons for preferring to be self-employed. “This is followed by the ability to give back to the community (38 per cent) and freedom to choose what to work on (36 per cent),” said the survey report.

Those who have already started their business seem to have similar reasoning. When asked about the reasons Mena professionals have for starting their own business, the top three reasons were: ‘wanted to do what I love’ (29 per cent), ‘having a great business idea’ (28 per cent) and ‘to achieve a better work-life balance’ (24 per cent), it said.

Of those who prefer to seek employment in a company in the UAE, the main reasons for their preference are: learning new skills (47 per cent) and stability of employment/ job security (47 per cent).

“Wealth creation is not the only driver for Mena entrepreneurs, who increasingly tend to be aspirational in other ways. Our survey aims to understand the views of entrepreneurs as a way to maximize impact and drive growth and innovation in the economy,” said Ola Haddad, director of Human Resources at Bayt.com. “As part of our research strategy, Bayt.com will continue to research topics that provide professionals in the entrepreneurial ecosystem with credible data to make informed decisions.”

Entrepreneurship continues to be a growing trend in the UAE. Despite the given challenges of setting up a business, the survey indicates that entrepreneurship has become more popular than ever before. When it comes to those who are currently employed, 70 per cent are currently thinking of starting their own business, 19 per cent of respondents have tried to start their own business in the past, while only 3.0 per cent never thought of starting their own business.

Many entrepreneurs are looking to grow their startups and establish business. Over a third (37 per cent) of Mena respondents have personal ambitions to grow their business further in their country of residence, followed by 27 per cent who aim to become a major international group.

Out of those who are self-employed in the Mena region, 38 per cent are at the startup stage of the business, while another 28 per cent say that their business is established but not performing well. On the other hand, 15 per cent say their business is well established and performing well.

The top concern of UAE respondents while setting up their own business, would be procuring finances to start (70 per cent) and the need to establish the right contacts (46 per cent).

The most appealing industries for entrepreneurship are considered to be IT/ Internet/ E-commerce (12 per cent), Commerce/ Trade/ Retail and Consumer Goods/ FMCG (both at 9.0 per cent), followed by Real Estate/ Construction/ Property Development (8.0 per cent).

The survey shows even greater benefits of entrepreneurship for societies and the economy. The perceived image of entrepreneurs in the region is very positive – UAE respondents perceive entrepreneurs to be opportunity-driven (88 per cent) and they help in creating new jobs (90 per cent).

The best pieces of advice offered to budding entrepreneurs by respondents in the Mena region are to not be afraid of failure (45 per cent). In addition, three in 10 respondents believe that innovation is the key to success as an entrepreneur, followed by employing the right people (25 per cent) and access to funding (18 per cent).

Zafar Shah, research Director at YouGov said the positive attitudes about entrepreneurship that we see in the Mena region are an encouraging sign. “It indicates that there is both a supply of potential entrepreneurs and those who may support their efforts. The ideas and innovations born in small companies and startups create a stronger economy, offering greater opportunities for upward mobility.”