Contractors are key economic driver, says RSA

Thursday 18 June 2015

Contractors are a very important part of the UK's economy, according to the Royal Society for the encouragement of the Arts, Manufactures and Commerce (RSA). The body made the claims in a report entitled The Second Age of Small in which it praised microbusinesses, the self-employed and contractors for their role in driving productivity throughout the country.

In the document, it was stated that there are now five million microbusinesses in the UK, which are defined by having nine or fewer employees. This is a significant increase from the 3.5 million of such enterprises that were in existence across the nation in the year 2000. In fact, microbusinesses now make up 96 per cent of all private sector companies in the UK.

Chris Bryce, chief executive of the Association of Independent Professionals and the Self Employed (IPSE), said: "This report confirms much of what we know about the self-employed. They work incredibly hard…but often don’t get the recognition they deserve."

The RSA report spends a considerable amount of time weighing up the positives and negatives of this increase in contractor numbers. It finds that contracting is not just good for the economy, but also for individuals, with success careers possible. Anyone thinking of going into the area should be reassured by this.

One of the things that the document highlighted is the fact that technology is an enabler for the self-employed, with working independently now easier than ever. This is particularly the case for those with technical and IT skills, as they can fulfil niches like never before.

As skills shortages become a more pertinent problem, it is increasingly contractors that are filling the gaps and having the pick of the jobs. The report stated: "Rising skill levels mean that people have never been better equipped to work for themselves. The proportion of the self-employed workforce with a degree or equivalent has risen from 20 to 28 per cent since 2001."

Among the takeaways from the Second Age of Small report was the fact that contractors are some of the most satisfied workers around. This is for a number of reasons, including having greater autonomy and decision-making powers, as well as good relations with management. With such an argument it seems that the contracting industry is likely to only get bigger moving forward.

By Victoria McDonnell

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