I run my jewelry business full time and support myself in a very expensive city. If I moved somewhere with a lower cost of living I would give myself a substantial raise! Etsy is my main online retail venue, but it’s not all my income; I also wholesale, have my own website, sell at markets, etc. I would say most successful Etsy shops are diversified in this way. How much I work depends- during the holiday season I’m easily working 70 hours per week. Off-season I take things easy, but I’m still working of course- sketching, playing with new techniques, researching marketing, catching up on book keeping, reading about SEO, etc. So I’m not sure how to answer how much I work specifically on my Etsy shop, because working on it is also working on my entire business.
I think in the off season, I work less hours total than the people I know with corporate salary jobs. If I spent more time working on my business, I do believe I would make more money. But I am active in volunteer work that is also very important to me, and being self-employed gives me the flexibility for that.
I do know people who sell almost entirely on Etsy and do well. But even still, most business owners I know are always trying to have multiple revenue streams.
Hope that sort-of helps to answer your question!