Michigan State University Extension
Home-Based Business - 09159423
10/01/98
Economics/Home Management, February 6-8, 1992.
Objectives 1. Document a profile of home-based workers relative to demographic, household, and business characteristics.
2. Determine differences, if any, between business owners, wage workers and demographic, household, and business characteristics.
3. Identify the types of occupations pursued by home-based workers.
4. Determine differences, if any between types of occupations pursued by business owners and wage workers.
Methods The data source is the Agriculture Experiment Station Cooperative Regional Project, NE-167. The sample for this study consisted for 899 randomly selected home-based worker households in Hawaii, Iowa, Michigan, Missouri, New York, Ohio, Pennsylvania, Utah, and Vermont. The study was conducted by the Iowa State University Statistical Laboratory in March-April 1989. Telephone interviews were conducted with the home manager in households identified as containing at least one home-based worker. The home manager was identified as the person who ran the household management. Two groups of home-based workers were identified: business owners and wage workers. The breakdown was: Business owner 74.6% Wage worker 25.4 Wage workers were defined as working for an employer but working out of their home rather than the employer's location.
Findings
Table 1 - Demographics of Home-Based Workers (n=899)
Total Business Owner Wage worker
(n=899) (n=670) (n=229)
Gender
Male 58.1% 58.3% 57.3%
Female 41.9 41.7 42.7
Marital status
Single 15.3 15.0 16.1
Married 84.7 85.0 83.9
Age 43.6 years 44.3 years 41.5 years
Years in school 13.9 years 13.7 years 14.4 years
Home ownership
Own home 87.3% 89.4% 81.9%
Not own home 12.7 10.6 18.9
Years in community 19.8 years 20.9 years 16.6 years
Household size 3.4 persons 3.4 persons 3.1
persons
Employment status Full-time 72.0% 68.3% 73.8% Part time 28.0 36.2 26.2 Business location Rural 46.1 47.5 42.0 Urban 53.9 52.5 58.0 Seasonality Seasonal 14.5 17.9 4.7 Not seasonal 85.5 82.1 95.3
Yrs in home-based 9.1 years 9.5 years 8.2 years work Net annual income $17,921.38 $15,706.02 $24,420.28
There were some differences between business owners and wage workers. Significant differences were found in age, years in school, years in the community and years in home- based work.
Table 2 Occupational Types
Business Owners Wage Workers
Ag Products & Sales 3.1% 3.6%
Clerical 4.0 11.4
Contracting 18.1 5.2
Crafts & Artisans 14.8 2.2
Managerial 3.0 4.8
Marketing/Sales 14.7 52.3
Mechanical & Transportation 15.5 6.3
Professional/Technical 11.5 13.3
Services 15.3 2.9
Farm owners were not included in this project unless they had a value added product, i.e. honey, jam making, etc. Contracting included carpentry, plumbing and heating, masonry, electric wiring, and home renovating. Marketing and sales included marketing, insurance, sales manager, computer systems, and real estate agents.
Implications Other research studies on home-based work have found that the majority of home-based workers were women. This random sample study found that the majority are men. The difference is the definition of home-based work. The criteria for selecting home-based workers in this study was a person at least 18 years of age who worked in or from home to earn income for a minimum of 312 hours over a 12 month period. This is a much better definition of the type of person that Michigan Extension is reaching in the small home business classes.