Everyone should experience the risk of precarity or self-employment

We are currently witnessing structural changes. A new generation of entrepreneurs is emerging, learning how to acquire additional capital and live in Croatia while doing business globally.

One of the major challenges in today’s employment is precarity, which refers to fixed-term or part-time employment, as well as work under contracts or one’s own limited liability company (j.d.o.o.). This form of employment is associated with various types of challenges and certainly brings three major problems to those in such employment relationships:

1. Access to professional education is limited by the resources available to the precarious worker (or manager), which are always less than those of corporations, which more easily commission or organize training for groups of employees. Therefore, the costs of education are not nearly as significant for someone who pays minimal contributions (or does not pay them at all), making education in such situations far from a priority. Significant discipline and rationalization are required to continuously invest in further education, professional training, and new skills.

2. Anyone who is not part of a larger/stable team faces challenges in identifying with projects and finds it harder to establish a solid point of identification that comes from working for known and/or large companies. ‘Team building’ events, holiday celebrations, trade fair visits, additional free training, and celebrations of success are more the exception than the rule.

3. This form of employment does not provide security, even though there is a relatively continuous influx of money. Obtaining a loan or leasing if you work in a j.d.o.o. is almost impossible if you cannot prove/guarantee that as a private individual you possess significant cash, savings, or assets.

‘Killers’ of small entrepreneurs

We can conclude that, although there are more challenges, these three diminish the overall effectiveness of the self-employed, making it difficult to decide on self-employment without a strong will to ensure a quality cash flow through discipline (illiquidity and insolvency due to non-payment or continuous operation with insufficient clients is the most common ‘killer’ of small d.o.o.s and j.d.o.o.s) in projects.

At the same time, for the economy of a country to be sufficiently productive, it is necessary to enable young retirees, young rebels of vibrant spirit and vision, employees whose companies have failed or who have been laid off in ‘rightsizing’, or those who simply cannot endure harassment/stress/full-day presence at work to establish their own companies, and also to assist in that. It is certainly not good for small entrepreneurs to be those who have become so out of necessity because they could not find employment in their field…

The trap of job security

The catch-22 is precisely in this. Instead of encouraging their own children to choose professions that bring ‘security’ in government administration, public enterprises, or large corporations, they should be encouraged towards self-employment, small entrepreneurship, and risk. Small entrepreneurs should not have greater privileges than other groups, but an atmosphere should be created where it is desirable to be self-employed or a small entrepreneur at least part of one’s life and to feel the joys of contributing to salary, profit tax, or establishing a company. A micro-entrepreneur should have practical access to capital, education, and relatively easy termination of self-employment.

The world is rapidly changing and becoming increasingly hectic, faster, and unpredictable, so the manager of tomorrow (probably today as well) must be flexible, constantly online, ready for frequent changes in strategy and tactics, always prepared to jump out of the comfort zone, which we naturally strive for as humans. Therefore, the pursuit of security is unrealistic and will become increasingly less real. In Croatia, although it may not seem so at first glance, we are witnessing structural changes brought about by compulsion (e.g., Kamensko workers), youth and vision (e.g., startups, Rimac Automobili), the arrival of EU funds, and generally the status of EU membership (hostels and diffused hotels, the arrival of major brands in tourism, transportation and distribution during the season…) and the creation of a new generation of entrepreneurs who learn how to acquire additional capital under difficult conditions, how to implement their ideas despite large oligopolies in the industry, and how to live in Croatia while doing business globally (but also how to make mistakes and not give up). The mentioned ‘help’ and ‘creating a climate’ should solely be a state of mind, not waiting for a reaction from politics or the state or professional associations. One should absorb knowledge and opportunities from successful ancestors and predecessors, and every wise and successful entrepreneur should invest some time and money in new generations of entrepreneurs, as this will contribute to improving the environment in which their company operates. When entrepreneurs do this, the state will follow.