Self employment outstrips traditional routes

Thursday 16 October 2014

Official figures show that people are choosing to start up limited companies, become sole traders or umbrella company contractors at a faster rate than others are choosing to follow traditional employment routes.

The latest Labour Market statistics from the Office for National Statistics (ONS) showed that the rate of people choosing to become self employed is currently at 6.6 per cent. Meanwhile, the rate at which people are going down the traditional employment route is at 1.9 per cent.

Already, ONS has found that close to five million people are self employed, which represents 15 per cent of the workforce. Additionally, the UK is seeing people turn to this method of working at the third highest rate out of all European Union countries.

This news was welcomed by the Association of Independent Professionals and the Self Employed (IPSE), which said that the statistics show a fundamental shift in the way that Britain chooses to work and that this will become a permanent fixture.

Chief executive of IPSE Chris Bryce said: "Today's figures show that self-employment is growing at more than three times the rate of traditional employment. This is proof that the rise in self-employment is here to stay as Britain gets back to work.

"People from all walks of life are choosing to leave the nine to five behind and take control of their own destiny. From young people straight from university to parents who want to balance work around family life, being your own boss has never been more popular."

Andrew Fahey, commercial director at Brookson said: "These figures show that becoming self employed is a method that works for many and is getting more and more appealing. However, people may be put off by the idea of making the jump as self employment can appear more confusing if you are used to being an employee. Seeking help from an expert, such as Brookson, will make the process easier and help you get fully set up as a self employed professional quickly."

Mr Bryce said the ONS figures should offer further encouragement to decision makers to take notice of the self employment sector and help to improve prospect for them.

He pointed to the fact that small businesses have been pushing the UK economy forward, something that has been demonstrated both by freelancer groups and political ministers in the past.

However, Mr Bryce, pointed out that some issues have been holding back self employed professionals. These problems include confusion over IR35, late payment, poor broadband and a lack of office space that is affordable to work in. Mr Bryce said that fixing these issues will help business in the UK flourish in the future.

ONS statistics show the amount of people finding work is on the rise. Between June and August, there were 30.76 million people in work, which was 46,000 higher than those noted between March and May 2014. However, it was also the slowest quarterly rise since the March and May quarter in 2013.

By Victoria McDonnell

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