According to Frances O’Grady, the TUC general secretary, the large rise in the number of self employed workers does not show an increased entrepreneurial spirit but is a reflection of a shift towards more insecure methods of earning a living.
Self-employment now accounts for 44 percent of the net rise in employment since mid 2010 says the TUC despite only one in seven workers running their own business.
Half the increase comes from workers aged 50 or over with self employed aged over 65 making the fastest growing group in the labour market.
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.”
However, PCG, the organisation representing the UK’s independent professionals, has defended the nation’s self-employed after, what it calls, an attack on the sector by the TUC.
Chris Bryce, CEO of PCG said:
“The rise in self-employment is a long term phenomenon that has continued steadily over a number of years through both positive and negative economic periods. It is a structural change in the way we approach the concept of work, not a cyclical occurrence based on an unhealthy jobs market, as the TUC claim.
“Not only do self-employed people actively stimulate economic growth, research shows their work also creates the permanent jobs which the TUC purports to be fighting for. The boom in self-employment is at the heart of the UK’s economic recovery and for the TUC to blame it for the problems experienced by vulnerable workers is misguided and unhelpful.
“The way we work is changing and it does not help our economy for backward-looking bodies like the TUC to fight against this change. Vulnerable workers need to be protected, but to tar all self-employed people with the same brush will do nothing for those who really need the support of a trade union.”
According to Chris Bryce, far from being a sector where vulnerability and exploitation is the norm, self-employment is out-performing traditional work both financially and in terms of quality of life:
“Research conducted by PCG shows that daily rates for independent professionals have increased since 2011 – a stark contrast to the declining salaries of employees during that time. What’s more, a recent poll of PCG members found that freelancers are optimistic about their rates in the year ahead.
“Even though 80% of freelancers are happy with the amount they are paid, the benefits of being in business on your own account are not just financial. Our research shows that 90% of freelancers are happy with their choice to go it alone while 80% are happy with the control they have over their working life and the amount of hours they work.”