The Precarity of Self-Employment among Low- and Moderate-Income Households.

This article examines the relationship between self-employment and economic insecurity among low- and moderate-income (LMI) workers in the United States, using a unique dataset combining longitudinal survey data with administrative tax records. The study finds that self-employment, particularly part-time self-employment, is associated with significantly greater odds of experiencing budgetary constraints, unexpected income declines, and high income volatility compared with full-time wage-and-salary employment. Access to emergency funds and health insurance are identified as key factors mitigating economic insecurity, highlighting structural disadvantages faced by the self-employed in this income group. The findings suggest that, for LMI workers, formal wage-and-salary employment with benefits tends to provide greater economic stability than self-employment, which often reflects survivalist and precarious work rather than entrepreneurial opportunity. The study calls for nuanced policy approaches that distinguish between opportunity-driven and necessity-driven self-employment and emphasizes the importance of addressing labor market inequalities to improve economic wellbeing among vulnerable populations.