Late-Life Career Choice: The Antecedents of Self-Employment Interest for Older Workers

Workforce ageing has stimulated research interest in entrepreneurship in later life. For older workers, self-employment is an important alternative to waged employment. The literature addressing entrepreneurial motivation has mainly examined young cohorts, and less is known about how age-related factors intersect with entrepreneurship. Entrepreneurial motivation in later life is multifaceted, involving a social transaction whereby entrepreneurial interest is developed in a context-dependent social process. Accordingly, the social context in which people work and live influences their interest in entrepreneurship. For instance, older people as entrepreneurs are often viewed as socially unacceptable, which can dissuade their move towards self-employment. The present research draws on social learning theory and social cognitive career theory (SCCT) to explore self-employment in later life and develop and test a mediated model of self-employment interest over three studies. Study 1 explored factors influencing late-career decisions and how self-employment is perceived among the other late-career options, such as retirement. Results of interviews with 31 professional association members (aged 40 years and above) identified several age-related factors that influence older worker’s self-efficacy and outcome expectations in the work domain. A model of late-career interest was developed incorporating the study results. The prominence of self-employment in the narratives supported the proposition that self-employment is an important career option in later life. Study 2 tested a model of self-employment interest focusing on the effects of future time perspective and social support on entrepreneurial self-efficacy - pre-venture, outcome expectations and self-employment interest. Findings from a sample of 174 members (aged 40 years and above) of a professional association revealed that an open-ended time perspective positively influenced entrepreneurial self-efficacy – pre-venture, and Support positively influenced outcome expectations. Consistent with SCCT, entrepreneurial self-efficacy – pre-venture mediated the relationship between future time perspective and self-employment interest, and outcome expectations mediated the relationship between Support and self-employment interest. Study 3 examined the influence of age norms. Findings from a sample of 598 financial services employees (aged 45 and above) supported prior hypotheses, replicating Study 2. Additionally, favourable age norms were positively related to entrepreneurial self-efficacy - pre-venture and outcome expectations. Consistent with SCCT, entrepreneurial self-efficacy - pre-venture and outcome expectations mediated the relationship between age norms and self-employment interest. Examination of the two-way interaction effect between age norms and future time perspective on entrepreneurial self-efficacy found that when age norms are favourable and time perspective is open ended, entrepreneurial self-efficacy – pre-venture was at its highest. The two-way interaction effect between age norms and Support on entrepreneurial self-efficacy - pre-venture suggested that when age norms were highly favourable, support was not related to entrepreneurial self-efficacy – pre-venture. However, when age norms are not favourable, Support was positively related to entrepreneurial self-efficacy - pre-venture, suggesting that age norms and Support complement each other in the development of interest in self-employment. This research extends current career and entrepreneurship theory in several ways. First, the inclusion of age-related psychosocial and sociocultural factors in the model shed light on the intersection between older age, the contextual environment and development of self-employment interest. Second, the findings support earlier arguments that older entrepreneurship is a social process whereby the social context in which people work and live influences their interest in entrepreneurship, and that entrepreneurial behaviour among older people needs to be sanctioned and supported to occur. Finally, the findings suggest the utility of SCCT in informing the development of self-employment interest in the late career stage. Practical implications, limitations and suggestions for future research directions are also discussed