Born in Bessbrook, County Armagh, Hobson was given a Quaker education in Saffron Walden and then Sidcot, Somerset.

Moving to Cardiff, he became an active socialist, joining first the Fabian Society and then becoming a founder member of the Independent Labour Party (ILP).

He began writing for the ILP newspaper, Labour Leader, and in 1900 was elected to the Fabian Society's executive.

He helped found the National Guilds League, but following disagreements with G. D. H. Cole over strategy, and The New Age's move to supporting social credit, he ceased theoretical work.

Throughout this period, Hobson had been involved in various profitable activities, managing a banana plantation and editing an investment journal.