Self-Employed Workers Struggle in the UK Economy

Within the past five years, the number of self-employed workers have risen dramatically, from 650,000 to a current estimate of 4.5 million people.

Within the past five years, the number of self-employed workers have risen dramatically, from 650,000 to a current estimate of 4.5 million people.  That means that in today’s society, a total of 15% of the active workforce is made up of those working for themselves. Although this growth can be attributed to a vast number of complex reasons, analysts are still heatedly debating the record-breaking high of self-employed numbers.  Reasons that have been approached include the recession that started a few years ago that made options more limited, a longer life expectation that is leading to a postponement in retiring, as well as an increase in the wanting to be our own boss.  


However, the downside of all this is the fact that, because being self-employed is not well supported by public policy, they are unfortunately facing big problems in today’s economy. On average they earn 40% less than average employees, and only one in three can pay into a pension fund.  They can also face the danger of being underemployed and not receive enough work.  In fact, weekly wages for self-employed workers have dropped by 20% since 2008. It has been reported that a small number have experienced problems being able to obtain loans or mortgages, due to the mere fact that they were self-employed. A survey done by Ipsos-Mori, commissioned by the Resolution Foundation, found that 27% of people asked said that they chose self-employment because they felt that had no other choice, and now they cannot seem to get out of it.

Gavin Kelly, Resolution Foundation chief executive, said: “The growth in self-employment over recent years has been astonishing – but the reasons for it are complex…[whatever] the cause, self-employment is often a highly precarious existence which isn’t that well supported by public policy. High levels of self-employment seem likely to be here to stay and policy makers have some catching up to do.” (via Financial Times, here)

As one-third of those who are self-employed describe themselves as ‘entrepreneurs’, a Department for Work and Pensions spokesman said: “[Small] businesses and entrepreneurs are the heartbeat of the continuing success of the country and as the economy grows, these self-starters may well become the employers of the future. “The truth is the number of people in work has increased by 1.35 million since 2010 – over a million of these jobs are full-time. We now have the highest employment rate for five years and record numbers of people are in work.”

The UK economy is without a doubt experiencing a definitive boom in the numbers of employed – however, the fact remains of how to be able to help the self-employed faction, and what policies can be implemented, as these businesses are here to stay.


MaryEllen Fenton | Journalist

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