Mon 1st Jun 2015
The UK’s labour market has experienced rapid recovery and substantial growth recently, and reports suggest that self-employment is accounting for a third of this growth. These reports stating that as much as 15% of the UK workforce are now classified as self-employed.
Why is self-employment becoming so popular?
There are many factors that could be driving the entrepreneurial spirit in the UK, including -
Organisations being open to contractors / freelancers- Have organisations become more open to the benefits of utilising freelancers to deal with peaks and troughs in demand? Out sourcing means they do not have the fixed overhead costs to deal with and they avoid the costs of employment and redundancies.
Technology –The enablement of the internet to connect people wherever they are has opened up opportunities to integrate remote workers in to the work flow within an organisation. The ability to have remote call centres, to integrate software to simultaneously collaborate on projects means that the practicality of working with contractors is becoming easier.
Demand for a more flexible lifestyle – is the rise due to a need for flexibility in lifestyles that being your own boss creates? With more contractors working on a part time basis is the juggling of commitments in a busy world the reason why self-employment suits people better than operating within the confines of an employed role. Statistics have shown that older people are more likely to set up their own business, and often have more luck in doing so. There has also been a rise in females becoming self-employed – maybe due to the flexibility enabling them to continue with careers they have built but with the flexibility needed for family life. It has been shown there is a rise in the £5,000-£7,500 income band, suggesting that many of the roles may be part time.
A result of the recession – maybe the rise was due to the need to be creative as job hunters looking for work found employed roles hard to come by. Setting up on their own in order to bridge spells of unemployment and get by until a secure role becomes available. Individuals, who have been made redundant, maybe have some cash to fall back on or help to set up a new business venture and so may find they have nothing to lose by giving it a go.
The consequence of becoming self-employed however is that the skill base of an individual needs to be broadened. Freelancers and contractors have to take charge of their finances and ensure invoices are managed correctly to ensure they get paid on time and compile accounts for tax purposes. There are however solutions, such as NWM solutions that make this much easier to manage.