Self-Employment: Importance and Advantages of Self-Employment, Scope for Creativity and Avenues of Self-Employment (For CBSE, ICSE, IAS, NET, NRA 2022)

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Importance of Self-Employment

Career is a way of making one՚s livelihood. Self-employment is also a career because one may employ oneself in business or in-service activities and earn one՚s livelihood. With growing unemployment and lack of adequate job opportunities, self-employment has become very significant. Its importance can be enumerated as follows.

Importance of Self Employment

Advantage of Small Business

Small-scale business has several advantages over large-scale business. It can be easily started and requires small amount of capital investment. The self-employment involving activities on a small-scale is a good alternative to large scale business which has brought various evils like environmental pollution, development of slums, exploitation of workers, and so on.

Preference over Wage Employment

In self-employment there is no limit of earnings as is the case with wage employment. In self-employment one can use one՚s talent for own benefit. The decisions can be taken quickly and conveniently. All these factors act as strong motivators for self-employment to be preferred over wage employment.

Developing the Spirit of Entrepreneurship

Entrepreneurship involves taking risks because the entrepreneur tries to innovate new products, new methods of production and marketing. Self-employment, on the other hand, involves either no risk or very little risk. But, as soon as the self-employed person starts becoming innovative and takes steps to expand his business, he becomes an entrepreneur. Therefore, self-employment becomes a launching pad for entrepreneurship.

Promotion of Individualised Services

Self-employment may also take the form of providing individualised services like tailoring, repair work, dispensing of medicines etc. Such services are helpful in providing better consumer satisfaction. These can be easily started and run by individuals.

Scope for Creativity

It provides opportunity for development of creativity and skills in art and crafts, leading to preservation of the cultural heritage of India. For example, we can see creative ideas reflected in handicrafts, handloom products, etc.

Reducing the Problem of Unemployment

Self-employment provides opportunities of gainful occupation to those who otherwise remain unemployed. Thus, it reduces the problem of unemployment.

A Boon to Under-Privileged in Respect of Higher Education

  • Everyone may not be able to pursue higher education after Secondary or Senior Secondary examination due to one or the other reason. Such persons can start their career as self-employed in occupations that do not require higher education.
  • It may be noted that self-employment has been given high priority in government policies and programmes. A number of schemes have been initiated all over the country to encourage entrepreneurship and self-employment.

Avenues of Self-Employment

After learning the importance of self-employment, you may be motivated to start your own enterprise even if it is on a small scale. But what are the areas in which you can successfully run your enterprise? Before choosing a suitable career in self-employment you must have some idea about the avenues in which self-employment opportunities are available. Let us categorise the avenues of self-employment into the following broad areas.

Avenues of Self Employment


Trade involves buying and selling of goods and services. With small amount of investment one can start and run a small trading unit. You can think of starting a small grocery or stationery shop in your locality. If you are able to invest more capital and readier to take risk, then wholesale business is a good option for you. One can also take up some agency business or become a stockist. The real estate business which is booming now-a day can also be a lucrative alternative.


One can start a small industry of manufacturing bricks or producing bakery items or confectionery. All these businesses require small amount of capital and simple equipment. Farming is another such area in which a person can work all alone or take the help of one or two persons. This is an age-old area of self-employment. Orchards, dairy, poultry, sericulture, fisheries, horticulture, etc. are good examples of avenues of self-employment.


Occupations that require special knowledge and training in a particular field also provide opportunities of self-employment. Lawyers, doctors, chartered accountants, architects and journalists fall in this category. However, one has to follow certain code of conduct framed by their association and need specialised knowledge and training.

Individualised Services

Tailoring, motor repairing, hair cutting, fashion designing, interior decoration etc. are some of the business activities, which provide individualised services to the consumers. These can be easily started and run by individuals. These activities are based on the personal skills of those who perform them. Blacksmiths, carpenters, goldsmiths are all self-employed persons.

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