Wage employment is the predominant form of employment in France: on average between 2008 and 2015, 83% of the labour force only earned a wage during the year, while 6% only earned income from self-employment. On average, self-employed workers generate higher earnings than wage workers. This is also true of workers with more than one job combining two types of earned income.

Transitions between different employment statuses are also common throughout a career. The majority of individuals aged between 20 and 60 who become self-employed in a given year have had a salaried job in the past. Wage workers who become self-employed tend to be younger and more highly educated than the average wage worker. Their change of status may be transitional or in addition to their wage work, as it is often the case among auto-entrepreneurs. Three years later, on average, more than half of the professional income of employees having started a self-employed activity is earned from self-employed work.

It is not possible to directly observe whether those setting up as self-employed workers for the first time see their earnings increase or decrease relative to their income if they had remained wage earners only. A valuation method using matching suggests that, on average, they suffer a loss of earnings. This is particularly the case for auto-entrepreneurs and manual workers for whom the loss of income remains true three years later. Only a minority of workers who become self-employed are able to generate higher professional earnings than those who are wage earners only. In addition, from the point of view of income, becoming self-employed represents a risk that increases with the individual’s initial level of income.