Self-employed see earnings fall

Self-employed people’s incomes have fallen fast over the last 12 years and to a much greater degree than those for people in jobs, according to a new report.

The report by Tax Research shows that, although the number of self-employed people has risen by over 22% between 1999 and 2011 – the last year for which figures are available, the earnings for those on between £2,000 and £100,000 a year had shrunk by around 32% per person. Average earnings have fallen from £15,000 in 2011 money to £10,400, with the largest drop being seen since the 2008 recession.

The report, by Richard Murphy, suggests the main reason is falling productivity which he says has dropped by 32.4% over the 12-year period.

He links the lower than expected fall in unemployment since the recession to the increased number of self-employed people and says many of those counted by the ONS as self-employed may be little more than “disguised unemployed”.

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