POLITICS

Most New UK Jobs Are For Self-Employed And Hit By Falling Income

21/08/2014 10:31 BST | Updated 21/08/2014 10:59 BST
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Most of the new jobs created in Britain since the financial crash have involved people becoming self-employed while average income for people working for themselves has slumped by more than a fifth, according to official figures.

The Office for National Statistics (ONS) said that self-employed Britons made up two-thirds (732,000) of the 1.1 million jobs that were created since 2008, while their average income has slipped by 22% to £207 a week.

This has brought the total of self-employed Britons to 4.6 million, bigger than at any time in the last 40 years and equivalent to 15% of the working population.

The most common jobs for self-employed people are in construction, carpentry and as taxi drivers, with there also being a rise in the number of management consultants and chartered accountants. Meanwhile, the number of self-employed Britons over 65 years old has more than doubled in the last five years to nearly half a million.

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The rise of self-employed Britons has been politically controversial, as critics say that they are in less secure work and are paid as much as 40% less than equivalent employees.

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Despite construction being the top job for self-employed people in 2014, it had the slowest growth between 2009 and 2014. The largest growth was for the "professional, scientific and technical activities" like working as a book-keeper, photographer, chartered accountant or management consultant.

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Emma Jones, founder of small business network Enterprise Nation, said that self-employment was becoming "the new normal".

She said: “There are a number of reasons why self-employment is booming. Of course it is partly down to a lack of satisfying jobs available and decreasing wages; but equally this must be explained by increasing technology which has empowered more people to respond to opportunity than ever before and monetise a skill or a hobby.

“The people we see are self-sufficient and confident. They are funding their own ventures rather than relying on bank credit. Many of them feel they could never move back into paid employment again after the experience of self-employment.

However the trade unions warned that income had 'collapsed" for self-employed Britons. Frances O'Grady, general secretary of the Trades Union Congress, said: "Today’s figures nail the myth perpetuated by ministers that the UK’s new self-employed workers are all young entrepreneurs. In fact, almost half are over the age of 50.

"Self-employment appears to be a key factor in the UK economy's shift towards low-paid work. Many people want to work for themselves, but the growth in self-employment is reducing people's pay, job security and retirement income, and is likely to be reducing the Government's tax take too."

Speaking to the Huffington Post UK, business minister Matthew Hancock said critics of self-employment were "doing down exactly the sort of attitude of get-up-and-go and aspiration that is going to get our country out of the very mess that usually those who are complaining are the ones who let us get in."