Michelle Romanica says she has a fire in the pit of her belly. That fire is customer service.
Before you roll your eyes or laugh out loud, consider this: Romanica spent 32 years on the front lines of customer service at Air Canada.
She says the most fulfilling times of her career were the last few years before she left. Those would be the post-9/11 years, when the spectre of terrorism, a slowdown in the economy and plummeting revenues brought the airline industry to its knees.
Employee morale was at rock bottom and customer satisfaction wasn’t far behind. But she loved the challenge: "That’s when I was able to give back the most. At the end of the day I was helping people make the situation better. That always spurred me on."
Romanica, who has been looking for work for about a year, recently made a decision. She is about to join the ranks of Canadians who strike out on their own.
The economy has shed about 454,000 jobs since the slowdown began last fall. Jobs have been lost in nearly every sector, from manufacturing and construction to tourism and financial services. The one constant source of job creation has been self-employment.
In 2008, there were an estimated 2.6 million Canadians who worked for themselves, according to Statistics Canada. In June alone, an estimated 37,000 Canadians became self-employed. That works out to about 1,233 people every day that month making the life-changing decision to be their own boss.
It’s tempting to see these job gains as a sign of green shoots in the economy, an indication that the worst of the recession has passed. But economists caution against that.
"I think the real sign of recovery will be when you start to see meaningful job gains in private sector employment," says BMO Capital Markets deputy chief economist Doug Porter.
That’s not expected until 2010.
Self-employment typically pays less (about 80 per cent of paid employment) and benefits are often non-existent. But it would be a mistake to see the growth in this part of the labour force as wholly negative, economists say.
"I see it as a positive," says Benjamin Tal, senior economist with CIBC World Markets.
"The alternative is unemployment. Anything that will give me $1 a month compared to no dollars per month is positive."
In this recession, self-employment has been keeping the overall employment rate lower, economists say, and probably lowering the demand on EI.
In the past 12 months, self-employment has grown by about 3 per cent.
That’s just slightly above historical levels. Self-employment has been rising at a steady clip – about 2 per cent annually – for about the past 20 years.
That rise has to do with a host of factors: the rise of niche markets better served by small companies, the growing ranks of baby boomers and workers who are let go but are not ready to throw in the towel.
The Internet, which has changed everything, has changed this, too.
"The very existence of the Internet makes self-employment much easier," Tal says.
"You just start something from your basement and you’re connected to the world."
Tal expects the number of Canadians working for themselves – now about 15 per cent of the labour market – to rise to about 20 per cent over the next decade, or even sooner. That means one in five working people will be self-employed.
Changes will be needed, Tal says, in lending practices, tax treatment, and overall attitudes.
"That means start recognizing self-employment as a normal way of living, not the exception," he says.
It’s true that some go into business for themselves because they simply can’t find any other paying job. Are those folks less likely to succeed as entrepreneurs?
Tal’s research has found that the answer is no.
"The surprising result is that motivation is not an indicator of future success or failure, and that’s very, very important," he says.
Of the 2.6 million who were self-employed last year, nearly half were unincorporated and had no paid employees, StatsCan figures show.
Some start-ups will remain one-person operations. But others will eventually add more workers and contribute greatly to the country’s economic growth, says Stewart Thornhill, director of the Institute for Entrepreneurship at Ivey School of Business at the University of Western Ontario.
The trouble is that growth is very difficult to track.
Says Thornhill: "What percentage of those people fall into the self-employment category, how many jobs do the high growers actually create? The data on that is awful."
Still, researchers have a pretty good handle on what breeds success online payday loans.
One huge indicator is age: the older you are, the more likely you are to succeed. That’s because the older worker has more experience, money and contacts.
You’re also less likely to exaggerate your likelihood of success, Tal says.
"Young people, if you ask them what they expect from the business, are totally unrealistic, which, you know is part of being young and innocent."
Thornhill has also studied the common pitfalls. At the top of the list: those who try to do everything by themselves. Successful entrepreneurs tend to be very good at building a trusted group of advisers.
"People tend to focus on innovation or technology but the ability to work with people, that soft stuff, doesn’t get nearly the attention it deserves," Thornhill says.
Though it seems counter-intuitive, the recession can be a good time to start a new business, says Gary Prenevost, president of FranNet for Southern Ontario. FranNet helps would-be franchisees find the right business for them.
"When somebody starts a business in a recession, they’re going to pay more attention to where to get customers and what keeps them happy," says Prenevost, who has been an entrepreneur himself, and provides coaching to others.
"They have more time to study what’s working and what’s not working, and a savvy operator will make those adjustments immediately."
That focus on customer service has worked for Jason McCague, 31, president of Facility Services Corp.
McCague started his company in 2002 offering mostly cleaning and janitorial services. He kept responding to customer requests and adding services, from landscaping to recycling and snow removal.
He now has more than 100 clients across the country and his company’s annual revenues top $1 million.
"The philosophy is that no matter how big the company, we will service our customers properly," says McCague.
Ultimately, what separates successful entrepreneurs from those who fail is that the successful ones never stop trying, Thornhill says.
"They learn from it and they do it better the next time, as opposed to the ones who run into the initial failure and say, `That’s it for me.’
"True entrepreneurs are known for their persistence, their ability to get knocked down and get back up and dust themselves off," he says.
It’s a lesson that hit hard for Donna Hall, a sales and marketing consultant who specializes in financial services firms. She lost a spate of clients in the spring as the recession took hold.
"It just hit so quickly and vibrated right down," Hall says. "In April and May I wasn’t making hardly anything."
Since then she’s expanded her client base to manufacturing and insurance. "I’ve had to learn a lot about new markets, but there is a lot of work for consultants like me," she says. "You just have to find the right markets."
When Romanica began looking for work, she thought customer service manager would be a natural fit. But these days, customer service work tends to be in call centres, and she hasn’t worked in one of those in 25 years.
Romanica sent many resumés but landed few interviews. One prospective employer said that her computer skills didn’t measure up.
"In my company, I had years behind me to have created a reputation for myself. My integrity was assumed. My abilities were assumed. My competency was assumed. I was entering a world where I had no reputation and only soft skills," Romanica says. "I know my value to an organization and I know my capability and I’m not at a point where I’m prepared to accept an entry level. I don’t have time for that. I’m not 20."
Her money – a reduced pension and savings – was running out. Romanica credits Happen Inc., a job search and networking organization, with her decision to start her own company. "It gave me the encouragement and support I needed to not just give into the fear of, `just get any job.’ It allowed me to stay focused on the fire in my belly and my passion."
Romanaica plans to call her company Customer Management Experience. The focus will be on teaching companies how to improve their customer service by first improving their own internal work culture.
"I feel I’ve been learning all my life how to get the most from people, whether it was customers or colleagues," Romanica says. "I’m now at a point where I can give back all I’ve learned, and hopefully people will benefit from that."
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