Self-Unemployment

Owen Jones writes:

Behold the plucky entrepreneur! Britain’s self-employed have now rocketed to record levels, making up one in seven of the workforce. Does a new age of prospering self-made men and women beckon in Cameron’s Britain?

I hesitate partly as I remember my own father’s experience when he lost his job in the mid-1990s. But rather than being suddenly transformed into a new Alan Sugar, in his case self-employment simply meant “getting the odd bit of work if I’m lucky”.

Today, a new phenomenon of self-unemployment needs investigation. As the Resolution Foundation point out, while one million more people have become self-employed since 2000, their median earnings have dropped by a whopping 20 per cent in the years after 2006.

Something has gone wrong – though we don’t know exactly what. And because the data for self-employed people lags by a couple of years, they’re completely missing from the current debate about falling living standards.

The shift towards self-employment is beneficial to many employers. The employed get holidays, sick pay, and in some cases pensions; hiring self-employed people who don’t have such benefits is much cheaper.

We clearly need thorough research into how many are “self-unemployed” – simply getting the odd bit of work, that is – rather than running thriving businesses.

The danger, of course, is that this is part of a broader trend to casualise our workforce, driving up the number of zero-hour, temporary and reluctant part-time workers, as the number of full-time workers with job security shrinks.

Good for big business, yes, but terrible for working people.