[UK] 40% of self-employed people earn less than £1,000 a month

More than 40 per cent of self-employed people in the UK earned less than £1,000 a month in April, compared with 27 per cent pre-pandemic, SmallBusiness.co.uk reports.

One-third of self-employed workers are struggling with daily living expenses, exacerbated by the fact that energy can be a major cost for many small businesses.

In addition, the total number of hours worked – most self-employed people are paid by the hour – is falling steadily, according to the latest London School of Economics (LSE) survey of self-employment.

Self-employed workers in the UK were among those hardest hit by the pandemic and their incomes and businesses have still not recovered, according to research from the LSE Centre for Economic Performance (CEP).

Stephen Machin - co-author and director of CEP - said, “The current cost-of-living crisis is exacerbating the challenges for self-employed workers, whose incomes and profits have not fully recovered from the pandemic shock. The impact of COVID-19 restrictions has lightened, but recovery has stalled in the face of the high costs of energy and raw materials. These are contributing to the financial difficulties of the self-employed, particularly small businesses.”

Columnist Matthew Lynn - commenting on the CEP research in the Daily Telegraph - argued that people who work for themselves “have been treated appallingly by government” whether that’s through a complicated and restricted COVID-19 financial support scheme, higher National Insurance and dividend taxes, IR35 treating them as employees without the benefits and now forcing them to use expensive Making Tax Digital accounting software.

“If the government was on a mission to hound the self-employed out of existence it could hardly be making a better job of it,” Mr Lynn wrote.

Robert Blackburn - the report’s co-author and professor of entrepreneurship at the University of Liverpool - said, “While the number of employees in the UK has steadily grown and is now above pre-pandemic levels, the numbers in self-employment are lower than they were in 2019. There was an increase in the number of people leaving self-employment during the Covid-19 crisis, but as the economy has picked up, the numbers going into self-employment have remained relatively low.”

Maria Ventura - co-author and research assistant at CEP - said, “Our findings suggest that the slow recovery of the self-employed from the effects of COVID-19 and its associated lockdown and support measures, is in jeopardy because of new challenges.”

For its research, the CEP surveyed 1,500 self-employed workers between 12 May and 7 June.

Source: SmallBusiness.co.uk

(Links and quotes via original reporting)

More than 40 per cent of self-employed people in the UK earned less than £1,000 a month in April, compared with 27 per cent pre-pandemic, SmallBusiness.co.uk reports.

One-third of self-employed workers are struggling with daily living expenses, exacerbated by the fact that energy can be a major cost for many small businesses.

In addition, the total number of hours worked – most self-employed people are paid by the hour – is falling steadily, according to the latest London School of Economics (LSE) survey of self-employment.

Self-employed workers in the UK were among those hardest hit by the pandemic and their incomes and businesses have still not recovered, according to research from the LSE Centre for Economic Performance (CEP).

Stephen Machin - co-author and director of CEP - said, “The current cost-of-living crisis is exacerbating the challenges for self-employed workers, whose incomes and profits have not fully recovered from the pandemic shock. The impact of COVID-19 restrictions has lightened, but recovery has stalled in the face of the high costs of energy and raw materials. These are contributing to the financial difficulties of the self-employed, particularly small businesses.”

Columnist Matthew Lynn - commenting on the CEP research in the Daily Telegraph - argued that people who work for themselves “have been treated appallingly by government” whether that’s through a complicated and restricted COVID-19 financial support scheme, higher National Insurance and dividend taxes, IR35 treating them as employees without the benefits and now forcing them to use expensive Making Tax Digital accounting software.

“If the government was on a mission to hound the self-employed out of existence it could hardly be making a better job of it,” Mr Lynn wrote.

Robert Blackburn - the report’s co-author and professor of entrepreneurship at the University of Liverpool - said, “While the number of employees in the UK has steadily grown and is now above pre-pandemic levels, the numbers in self-employment are lower than they were in 2019. There was an increase in the number of people leaving self-employment during the Covid-19 crisis, but as the economy has picked up, the numbers going into self-employment have remained relatively low.”

Maria Ventura - co-author and research assistant at CEP - said, “Our findings suggest that the slow recovery of the self-employed from the effects of COVID-19 and its associated lockdown and support measures, is in jeopardy because of new challenges.”

For its research, the CEP surveyed 1,500 self-employed workers between 12 May and 7 June.

Source: SmallBusiness.co.uk

(Links and quotes via original reporting)