For British workers, there has never been a better time to consider becoming self-employed. With record numbers of people choosing to work for themselves, self-employment in the UK is experiencing a boom.
Research from the Office for National Statistics (ONS) confirms that self-employment is at its highest level in the UK since records began 40 years ago. In fact, statistics show that around 15% of UK workers are registered as self-employed, which equates to one in seven workers. Currently, there are a staggering 4.6 million self-employed people in the UK.
Age Is No Barrier to Self-Employment
Many people might associate self-employment as the preferred choice for go-getting young entrepreneurs, but statistics show that this type of working arrangement appeals to a broad spectrum of people. It is not just the young who are going down the self-employment route. In fact, if anything, it appears those deciding to become self-employed tend to be older, at an average age of 47 compared to 40 for those not self-employed. The ONS also states that an increasing number of people over the age of 65 are embarking on self-employment, possibly as a way to top up pension incomes. Figures suggest there are almost half a million over-65s in the UK registered as self-employed – a figure that has more than doubled in the last five years.
A Growing Trend
In the last year alone, UK self-employment rose by 8%. This is the equivalent of around 7,700 people becoming self-employed every week. Whilst 15% of people are now self-employed, this was just 13% in 2008 and only just over 8% 40 years ago. Much of the increase in total employment since 2008 can be accounted for by the rise in self-employment.
The surge in British workers choosing to become their own boss may be partly fuelled by the economic depression of recent years. As job opportunities declined during the downturn, more people may have decided to take the plunge and work for themselves. Even with limited capital, many people may have secured self-employed loans to kick-start their new venture. For those wanting to become self-employed bad credit scores may have made the task of getting self-employed loans even more difficult, although not impossible.
What is certain, according to the ONS, is that lots of people who are turning to self-employment are not necessarily doing it for the money. Many self-employed people are earning low wages yet working long hours, possibly suggesting other factors may be at play in the rise in this way of working. With more people appreciating the benefits of being their own boss, especially the flexibility of fitting work around family and other commitments, it could be that self-employed workers are willing to accept lower pay for a better work-life balance. The ONS reports that since 2008-9 those people who work for themselves have, on average, seen their income drop by 22%.
With fewer people leaving self-employment in the last five years, the ONS also believes that the lack of job opportunities may have forced many to stay put, whether they wanted to stay self-employed or not. Just 886,000 workers left self-employment between 2009 and 2014, compared to 1.3 million self-employed workers who quit between 2004 and 2009.
Self-Employment Highest in the South
Self-employment patterns vary by region in the UK, with more people who work for themselves residing in the south of the country. Not surprisingly, the capital is the prime spot for self-employment, with 17.3% of working Londoners choosing this way of life. The South West is also a self-employment hotspot at 16.6%, compared to just over 10% in the North East. Scotland also lags behind compared to the rest of England, with 11.5% of workers north of the border choosing to work for themselves.
How Does the UK Compare to Other Countries?
The average number of workers who are self-employed in the EU is 15.2%, so the UK is pretty much average in comparison to Europe overall. Self-employment is much higher in countries such as Greece, however, where one in three people work for themselves. On the other hand, Luxembourg cannot be described as a nation of self-employed workers, with just over 8% of its workforce opting to become their own boss.
