Freelancers ‘must be separate from SMEs’

Wednesday 6 November 2013

Independent professionals should be represented in a category of their own in official statistics, rather than being classed among small businesses or in self-employment figures, according to research from Professional Contractors’ Group (PCG).

The study, completed in conjunction with the European Forum of Independent Professionals (EFIP), shows that so-called “iPros” - freelancers, contractors other independent professional workers - are not recognised for their valuable and unique contribution to the economies in which they work. Indeed, they are all but invisible in academic research and subsumed into self-employment or small business statistics. But the paper argues that given their importance in filling skills gaps so companies can meet rising demand, iPros need to be much more widely studied.

“At a time of rapid change and increased competition, it is critical that European policy makers and the business community understand iPros, the skills and innovation they provide, and ways in which their contribution to the economy can be nurtured,” write the report’s authors.

Freelancers are already making quite an impression on a number of key industries, as more highly skilled professionals look for a more independent and flexible way of working. Indeed, the study finds that iPros constitute a quarter of those working in professional, technical and scientific disciplines, as well as over a fifth of all arts and entertainment workers.

Interestingly, growth in the number of professional taking to freelancing is spread across the EU - with a sharp jump of 45 per cent between 2004 and 2013, there are now nearly nine million iPros working across the 27 member states. In the UK, growth has been even more pronounced, with a 63 per cent jump over the same period. But the increase has been particularly acute in the Netherlands, Poland and France, which demonstrated growth of 93, 88 and 85 per cent respectively.

Perhaps the rise is fuelled by the fact that for many freelancers, their way of working is extremely fulfilling, offering them freedom and flexibility that they would not have as employees. In fact, the report says survey data shows nearly four out of ten EU citizens agree with this assessment and would like to become independent workers. However, they are put off by concerns such as the fear of failure, red tape, and not having the right finance and skills to launch their career.

Among the iPros who were interviewed for the study, the freedom to determine their own workload was one of the most popular motivations. Some said they had felt undervalued as employees or tired of doing the same thing every day. Others said they valued being able to focus on the work they enjoy - in one case, a freelancer felt that their responsibilities as a manager were stopping them from doing the specialist writing work that they had always done.

Although most freelancers consider an entrepreneurial spirit to be crucial to success in their chosen way of working, they tend not to see themselves as entrepreneurs. Many do not even call themselves small businesses: indeed, most prefer to identify themselves as “freelancers” or “independent”, indicating the uniqueness of this career choice that PCG says should be respected.

By Victoria McDonnell

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