Employment, Self-employment, and Freelancing: What's The Difference?
You may think that in the matter of finance, it doesn’t matter whether you are employed, self-employed, or a freelancer. As long as you pay the bills, who needs the labels, eh? Unfortunately, it does help to know what kind of professional you are, as others would certainly categorize you based on that.
Whether it’s the lenders, leasing agencies, or the government, they would ask for it and some proof of the type of your profession for matters like furlough scheme, and all. So, let’s learn the difference between employment, self-employment and more from below.
Employment
In most general cases, employment simply refers to the state of life where one has a paid job. It’s often categorized based on the hours required by the job - part-time employment, full-time employment. It’s an umbrella term, which even includes self-employment, freelancers, independent contractors, etc. The word can also refer to the act of employing people, in the form of giving or creating employment.
Self-employment
Self-employment is a type of employment where one employs herself. To put it simply, when someone works for himself either as a business owner or a freelancer, he or she is self-employed. For example, if you own a corner shop and run it yourself, you are employing yourself and being your own boss. This way, a self-employed person can also create employment for others.
Freelancer
Also known as contractors, freelancers are workers who take on different jobs from different clients. While they are also primarily referred to as self-employed in government documents and by the Association of Independent Professionals and the Self-Employed, they have their unique characteristics.
A freelancer may have to drift from client to client depending on their set of expertise, while a self-employed person may focus on attaining his own financial objectives. A freelancer also tends to have a boss in the form of a client, but self-employment doesn’t.