Earnings Growth Among Young Less‐Educated Business Owners

Using data from the National Longitudinal Survey of Youth (NLSY), I examine the earnings patterns of young less‐educated business owners and make comparisons with young less‐educated wage/salary workers. Estimates from fixed‐effects earnings regressions indicate that the self‐employed experience faster earnings growth on average than wage/salary workers after a few initial years of slower growth. I also find some evidence suggesting that a relatively high percentage of less‐educated business owners, especially men, experience either rapid earnings growth or large annual losses.