More than two in five new jobs created since mid-2010 have been self-employed

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Self-employment accounts for 44 per cent of the net rise in employment since mid- 2010, with pensioners, part-time workers and ‘odd-jobbers’ the fastest growing groups of Britain’s new self-employed workforce, the TUC says today (Monday) ahead of the latest employment figures published later this week.

The TUC analysis shows that despite self-employment being a relatively small part of the UK jobs market – just one in seven workers are self-employed – it has accounted for 44 per cent of all employment growth since the last election.

Workers aged 50 plus account for half the increase in self-employment, with self-employed workers aged 65 and over the fastest growing group in the labour market (increasing by 29 per cent since the end of 2010).

Over 40 per cent of all the self-employed jobs created since mid-2010 are also part-time. The TUC is concerned that many people are only taking this kind of work because they are unable to find good quality employee jobs which provide the stable employment they really want.

The TUC’s analysis also shows that the number of people starting their own businesses has fallen in recent years, in spite of rising self-employment. The biggest growth areas of self-employment since mid-2010 have been people working for themselves (up 232,000), freelancing (up 69,000) or sub-contracting (up 67,000).

The number of self-employed people who either run a business, or are a partner or sole director in one (positions usually associated with entrepreneurship) has actually fallen by 52,000. These figures show that rising self-employment is part of a wider shift towards insecure employment, rather than as a result of a growing number of people starting up new companies as ministers like to claim, says the TUC.

Self-employment has been going up steadily since early 2008, even when unemployment was rising sharply, and has increased even more in recent years.

The TUC is concerned that the growth of self-employment is at the expense of more secure employee jobs. Many newly self-employed workers do the same work as employees but with less job security, poorer working conditions and often less take-home pay, says the TUC.

Other forms of self-employment – for example selling goods online or registering as self-employed to do the occasional ‘oddjob’ – tend not to pay enough to make a decent living, says the TUC. Recent figures from Citizens Advice suggested that self-employed workers are as likely to have debt problems as unemployed people.

Self-employed workers also have no right to paid sick, holiday, maternity or paternity leave, redundancy pay or protection against unfair dismissal – a particular problem for self-employed workers who are sub-contracted to another employer. The government is also planning to exempt most self-employed workers from vital health and safety protections in the Deregulation Bill currently making its way through way through Parliament.

Self-employed workers are often poorly paid, says the TUC. Recent Resolution Foundation research found that earnings from self-employment fell by a fifth between 2006 and 2010, while official figures published by Parliament found that the average annual income from self-employment is less than £10,000 for women.

The TUC is concerned that insecure work including self-employment, agency work and zero-hours contracts are becoming a permanent feature of the labour market, even as the economy recovers. The growth of casualised work is likely to continue to hold back wages, and prevent people from having the kind of secure employment they need to pay their bills, save money and plan for the future, warns the TUC.

TUC General Secretary Frances O’Grady said: “Self-employment accounts for almost half of all the new jobs created under this government.

“But these newly self-employed workers are not the budding entrepreneurs ministers like to talk about. Only a tiny fraction run their own businesses, while the vast majority work for themselves or another employer – often with fewer rights, less pay and no job security.

“While some choose to be self-employed, many people are forced into it because there is no alternative work. The lack of a stable income and poor job security often associated with self-employment makes it hard for people to pay their bills, arrange childcare, plan holidays or even buy or rent a home.

“The economy is finally back in recovery yet people’s wages are still shrinking and many are unable to find stable employment. Until we see decent pay rises and better job security, working people will continue to feel that the recovery is passing them by.”

NOTES TO EDITORS:

Change in employment (000s), employees and self-employed (full-time and part-time), April–June 2010 to November–January 2014

Total employment

Employees

Self-employed

Self-employed full-time

Self-employed part-time

Apr-Jun 2010

28,975

24,831

3,924

2,908

1,015

Nov-Jan 2014

30,191

25,487

4,464

3,223

1,241

 Change

+1,216

+656

+540

+314

+226

Increase (per cent)

4.2

2.6

13.8

10.8

22.3

Source: Labour Force Survey, seasonally adjusted

Change in self-employment (000s) by status and age, October-December 2010 and October–December 2013

Age bands

16-24

25-34

35-49

50-64

65+

50+

Total

2010

162,176

619,043

1,548,243

1,340,520

322,110

1,662,630

3,669,982

2013

174,553

751,901

1,605,297

1,450,831

417,087

1,867,918

4,399,669

Change (000s)

+12,377

+132,858

+57,054

+110,311

+94,977

+205,288

+407,577

Increase (per cent)

8

21

4

8

29

12

10

Source: Labour Force Survey, not seasonally adjusted

Change in self-employment (000s) by status, April–June 2010 to July–September 2013

Date

Total

Paid by  employment agency

Sole director

Running a business

Partner in a business

Working for themselves

Sub- contractor

Freelance

2010

3,896

38

189

229

413

2,228

358

416

2013

4,213

29

174

232

371

2,461

425

484

Change (000s)

+317

-9

-14

+3

-41

+232

+67

+69

Increase (per cent)

8.1

-24.1

-7.5

1.2

-10

10.4

18.6

16.6

Source: ONS data from Freedom of Information request.

- The three tables cover slightly different time periods due to the availability of ONS data and the need to minimise distortions in the non seasonally adjusted figures for self-employment by age.

- The ONS self-employment data by status is available at www.ons.gov.uk/ons/about-ons/business-transparency/freedom-of-information/what-can-i-request/published-ad-hoc-data/labour/january-2014/self-employment-by-status-2005-2013.xls

- The Resolution Foundation report that includes data on earnings from self-employment, is available at www.resolutionfoundation.org/publications/state-living-standards

- The House of Commons figures on income from self-employment are available in column 758W at http://www.publications.parliament.uk/pa/cm201314/cmhansrd/chan130.pdf

- The Citizens Advice figures are available at www.citizensadvice.org.uk/index/pressoffice/press_index/press_20140319.htm

- All TUC press releases can be found at www.tuc.org.uk

- Follow the TUC on Twitter: @tucnews

Contacts:

Media enquiries:
Rob Holdsworth    T: 020 7467 1372    M: 07717 531150     E: rholdsworth@tuc.org.uk

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