Study of cortisol drop in twins reveals true impact of self-employment on stress

New research from Bayes Business School (City St George’s, University of London) has revealed that work-related stress heightens when people become self-employed compared to working for an organisation, even when business owners possess high barriers to strain through genes and upbringing.

The research, led by Vangelis Souitaris, Professor of Entrepreneurship at Bayes, with academics from Warwick Business School and the University of Notre Dame (United States), collected data from more than 2,000 sets of identical twins. Across two studies, academics compared both perceived and chemical changes in stress between employed and self-employed individuals.

Key findings suggest workers who transition to self-employment report, on average, 24 per cent higher stress levels over a six-year period compared to twins who did not. Meanwhile self-employed participants maintained higher levels of cortisol, a stress-related hormone, throughout the day suggesting greater exposure to daily stresses.

While entrepreneurs enjoy more variation in their work with greater control on tasks, longer working hours can increase stress. Prior studies have shown self-employment to be a more stressful occupation overall but fail to factor in previous exposure or pre-conditioning to stress that individuals already accept when choosing to set up their own business. To account for this, identical twin sets with shared genes and early environmental rearing were selected as a point of comparison.

A first study examined self-reported stress among Finnish twin sets who had been raised together, including pairs that had chosen different employment types from each other. Surveys were taken in two waves, six years apart, to measure developments in stress levels in response to a quartet of four-point scale questions in the Reeder Stress Inventory¹.

Using working hours and work variety as variables in the relationship between self-employment and stress, the research found significantly increased stress levels in those transitioning from regular employment to self-employment, with little change when making the opposite move. Furthermore, longer working hours were associated with a notable rise in perceived stress, with supposed gains from increased work variety failing to substantially mitigate it.

A second study measured daily levels of cortisol in 59 pairs of American twins. As cortisol typically peaks shortly after waking up and decreases throughout the day, researchers took four participant readings for four consecutive days and compared results between self-employed and non-self-employed twins. In accordance with findings from the first study, the decrease in cortisol flattened out earlier in the day among self-employed people with levels 53 per cent higher on average than that of their identical twin immediately before going to bed.

Professor Souitaris said the study should serve as an eye-opener for entrepreneurs and those seeking to start their own business in the New Year:

“Depending on our personalities, self-employment can be highly motivating and rewarding but also challenging and emotionally draining.

“Our research suggests that even those who are preconditioned to thrive in this environment experience higher stress over time than counterparts working in an organisation. Even though variety is a major attraction to self-employment, it does not appear to make life any less stressful. Overtime, however, does add to stress.

“Business owners must ensure that they set boundaries to avoid burnout and manage their time effectively. Seeking automation, outsourcing and personnel at an early stage can also help alleviate health problems and achieve success.

“Our findings should also alert policymakers, many of whom are striving to promote entrepreneurship initiatives. Provisions for health should be factored into support packages for small business owners alongside financial incentives.”

‘Does self-employment increase stress? A co-twin control analysis of Finnish and US twins’ by Professor Vangelis Souitaris, Professor Nicos Nicolaou, James Waters, Professor Dean Shepherd and Nisha Hashem, is published in the Journal of Business Venturing.