Self-employment reaches new high

The number of people who are self-employed has risen to a record high, but most are part-time ‘odd jobbers’ desperate to avoid unemployment, according to a new report by the Chartered Institute for Personnel and Development.

The report, The rise in self-employment, based on official statistics, finds that by the spring of 2010 self-employment was higher than at the start of the recession in 2008 and by the autumn of 2011 had reached a record level of 4.14 million (14.2 per cent of the workforce).

It says the additional self-employed since 2008 are unlike self-employed people as a whole in terms of gender, hours of work, occupation and sector of employment. Although well over two thirds of self-employed people are men, women account for more than half (184,000, or 60 per cent) of the net rise in self-employment since the start of the recession.

However, most of these additional self-employed people work less than 30 hours a week. Although a large number of self-employed people are in the construction industry, their number has fallen since 2008 and sectors like education, information and communications, financial and insurance services and public administration, defence and social security have seen the biggest rise in the last three years.

Skilled trades-people – typified by ‘white van man’ – have the single largest share of self-employment (almost 30%) but account for less than 1 per cent of the net rise in self-employment since the start of the recession. The report says unskilled work accounts for more than 20 per cent of the net increase, with those in administrative and secretarial and personal services occupations also registering large proportional increases.

Dr John Philpott, Chief Economic Adviser at the CIPD, says: “The typical self-employed person in Britain today remains a skilled tradesman, manager or professional working long hours on the job, but since the start of the recession the ranks of the self-employed have been swelled by people from a much wider array of backgrounds and occupations, including many ‘handy-men’ without skills, picking-up whatever bits and pieces of work are available. It’s good that these self-employed ‘odd jobbers’ are helping to keep the lid on unemployment in a very weak labour market, but their emergence hardly suggests a surge in genuine entrepreneurial zeal. While some of these newly self-employed may make a long-term commitment to being their own boss, or at least gain the necessary experience to do so, it’s likely that most would take a job with an employer if only they could find one.”

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