Stupid Advice: You’ll Never Be Rich Working For Someone Else

Entrepreneur Scott H. Young talks about his views on the subject, based on his own entrepreneurial experience. We hear from her:

I worked as a sole proprietorship for nine years, then I became partners and we had a company. I had a good income at that time. My job allows me to do interesting projects, travel full time and work whenever I want.

Advertised “Make money from home” on online platforms to many users. Think of it as if I’m living the fantasy you see in your scam. Despite all this, “You will never get rich while working for someone else.” I hate advice.

This is a small discourse that can be seen in some corners of the internet, showing entrepreneurship as preferable to being an employee on the road to wealth, freedom and happiness. This advice tells you that working for someone else is a sucker and that you need to start your own business to truly live.

Why is this stupid advice?

This is terrible career advice. Do not get me wrong. I love doing my own work. But the idea that entrepreneurship is the best path to wealth and freedom is, in my opinion, silly. First, the advice doesn’t make sense. Many of the richest people I know earned all their money working for other people. CEOs, doctors, engineers, accountants; they all work for others and they are all rich. Also, even if we ignore the fact that the advice is completely wrong; entrepreneurship offers no better way to achieve wealth than working for others.

Supply and demand

All career choices proceed with the logic of supply and demand, just like purchasing decisions. If a career choice is really attractive i.e. too much money, little effort, low talent etc. If it offers something new, it will attract lots of new participants. These new entrants will increase competition, drive down revenue, and the business will no longer be as attractive.

Imagine for a second that being an entrepreneur takes less effort and offers more money to start with, with fewer hurdles than running a business. What do you think will happen? More people will start starting business! These companies will enter the competition. Some will succeed, some will fail. After all, it could be argued that the average return to each new entrepreneur will shrink until it no longer becomes very lucrative.

Economists say we should earn this steady level of profit as normal business profit. It contrasts with economic profit, the type of profit you earn when you have a monopoly or that you can prevent others from competing against you.

Why don’t people earn the same amount?

There are at least three intermediary factors that explain why some people earn more than others:

Some occupations have a very narrow range of possible incomes. For example, being a teacher in a public school. Others have large ranges, long-term prospects for becoming an entrepreneur, according to one teacher.

This is a problem with evaluating entrepreneurship because it has much more variance than regular occupations. This means that you will find that some people are really rich. However, when you count the cost of their time and investment, many people end up with zero or negative earnings.

A risky occupation may yield slightly higher than average returns. Because people tend to avoid risk. This means that people prefer a regular and stable income to the path that leads to wealth or poverty by chance.

Some careers are sexy and prestigious. There is job security and a pension. Others guarantee an impressive stare at parties when you tell people what you’re doing. It gives you a strong image.

Money is not the only thing people expect from a career. Therefore, the more sexy, comfortable, prestigious or secure your job is, the more people will want it for a certain income. A tradesman can make more money than someone who is a lecturer at a university. Being a lecturer is more challenging and challenging. However, since having prestige is more important for most people, they prefer to be a lecturer rather than a tradesman.

The ultimate distinguishing factor is the barriers to entry. Sometimes it is blocked due to talent. You might come across a supermodel for a good job, but most people don’t go into it for lack of talent and connection.

Medicine is a highly lucrative profession, being a desirable job for non-monetary reasons and offering relatively secure wealth. But medical school is also extremely demanding, and most people aren’t smart enough for those schools. Others can’t stand years of training to become a doctor.

Once you factor in the variance, non-monetary benefits, and barriers to entry, you can explain why most, if not all, career options pay more than others.

Why doesn’t this analysis look so good for entrepreneurship?

Now let’s do our analysis above and apply it to entrepreneurship. Definitely a big variance! This means that some people will win big and some people will win nothing. Most people want to be their own boss because having your own business is an attractive job.

Finally, the obstacles you may encounter at the beginning are generally few. In some industries there are really high costs to start a business. However, these industries are not industries that most people who think about the absurd statements I mentioned above would step into.

However, such analyzes are valid not only for entrepreneurs but also for every profession.

That doesn’t mean it’s impossible to be rich. Effort, acquired skills, connections, credentials and other career backgrounds can push you into areas where you can enter more serious rewards and less competitive niches. But it definitely dispels the idea that you can get rich by avoiding working for someone else.

This does not mean that career choice is not important. Some careers are inherently more difficult and more restrictive than others. Being a janitor will usually pay less than being an accountant. Because how much more can you clean things up so people give you more money?

In short, choose a career that taps into your talents and capabilities so that your full potential can be unleashed. In addition, your career values for example, status, money, security, etc. Appropriateness is also important. As a result, invest in developing your skills, experiences, connections, and aspects of yourself that others cannot. This is the right path to a successful career, the rest is just luck.

I love being in charge of my business. I think it’s challenging, interesting and a great career path. But I certainly don’t think this is the easiest way to make money. It’s like I lead an average life, in a semi-stable order. Until I reached this level, I did not work in conditions that were lighter than the working conditions in other fields. It took an incredible amount of effort to set up this business.

Entrepreneurship may be better for you if you see an opportunity that will challenge you and draw you in with different variations than a typical profession. If they say you can make a lot of money without working hard, someone is deceiving you.