Over half of solo entrepreneurs earn less than €30,000 a year

Solo entrepreneurs say their incomes have fallen significantly since spring 2024.

More than half of solo entrepreneurs (54%) now earn less than €30,000 a year. That is the finding of a fresh solo entrepreneur report from Suomen Yrittäjät, the Finnish SME association. SY considers tax hikes one reason for this.

Sonja Antosalo, a specialist in solo entrepreneurs at SY, says the VAT increase has had an effect on income levels.

“The rise in costs is another factor in weaker incomes. Some are also affected by the YEL reform introduced by the previous government. The change in demand for the service sectors may have an impact on the fact that woman entrepreneurs, in particular, are facing more difficulties,” Antosalo says.

More than half of solo entrepreneur respondents earn less than €30,000 a year, and three in ten earn less than €20,000 a year. Around one in six, 17%, entrepreneurs earn more than €50,000 a year. Last April, 46% said they earned less than €30,000 per year.

The situation appears most difficult in the retail and service sectors and among woman entrepreneurs.

These are the findings of a fresh solo entrepreneur report from Suomen Yrittäjät, which is based on solo entrepreneurs’ responses to the Yrittäjägallup survey of SMEs. The survey attracted 473 responses from solo entrepreneurs in November 2024.

Weaker faith in the future

Compared to the report published in April, slightly more solo entrepreneur respondents believe their businesses’ financial standing will weaken over the next year.

“The general economic situation and weak consumer confidence are linked to sectors dominated by solo entrepreneurs. In addition, things like the cuts to the tax credit for household expenses are hitting many solo entrepreneurs,” Antosalo says.

When asked about satisfaction with the Government, solo entrepreneurs are less satisfied than other business owners. They are slightly more satisfied with the opposition than other business owner respondents. Young people and women are least satisfied with the government.

“This dissatisfaction is potentially caused by recent cuts and tax changes. In addition, many changes made by the Government have a direct impact on sectors in which many woman entrepreneurs, in particular, operate,” Antosalo says.

The full solo entrepreneur report is available here.

SY’s 14 measures to help solo entrepreneurs

Completely reform the entrepreneur’s pension system (YEL) to restore business owners’ faith in the system.
Allow simultaneous unemployment insurance of entrepreneurial work and employment.
End periodization of sales profits in unemployment insurance.
Set net income as the basis for business owners’ housing allowance.
When means testing student support, ignore business income earned outside studies.
Develop vocational apprenticeship education and pilot third-level apprenticeships.
Consider all business types when developing an incentivizing tax system.
Raise the lower VAT threshold to €30,000.
Allow sole traders to offset child carers’ wages against taxation.
Allow sole traders to offset exercise and cultural benefits against taxation.
Make better consideration of solo entrepreneurs in business and advisory services and in financing opportunities.
Invest in services which support changes in ownership.
Introduce occupational health service models to support business owners’ work capacity and respond to the challenges of changing entrepreneurship and new forms of work.
Promote the hiring of the first employee by reducing the risk of hiring, such as by:
a) reducing the qualifying period for sickness allowance under the Health Insurance Act to three days
b) allow employers not to pay salary for an employee’s first sick leave day
c) ease dismissals on personal grounds.

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