Interim report into the future of self-employment

Today, the Inquiry into the Future Self-Employment launches its interim report and urges the government to take urgent action to avoid a ‘stampede’ away from self-employment.

Many self-employed Community members have shared their extremely difficult stories and situations due to the pandemic and its impact on their work and livelihoods due to the lack of adequate support, and too often no support, from government.

That’s why, we are supporting the Inquiry into the Future of Self-Employment set up by Prospect and also supported by the FSB to ensure self-employed workers are given a voice, and ensure their stories are heard. We have launched our interim report in light of the urgency of the situation.

The key findings are:

  • Over 50% of self-employed workers had lost 60-100% of their household income in 2020
  • 64% were less likely or unsure if they wanted to continue to be self employed in the future
  • 73% had been unable to access DWP support such as Universal Credit
  • 88% did not believe that support for the self employed in the pandemic had been commensurate with their tax contribution

In response the Inquiry has called for the immediate introduction of a Self Employment Stabilisation Scheme (SASS) to complement and build on the existing Self Employment Income Support Scheme (SEISS).

The SASS would close existing gaps in the SEISS scheme, such as for company directors, the newly self-employed those who are caught by the cliff-edge thresholds in the SEISS scheme. In addition the SASS would introduce sectoral funds in areas with large freelance workforces, such as the creative industries, to support these workers and halt a flow of vital skills out of these sectors.

The Inquiry argues that this additional support is necessary to enable a swift economic recovery in 2021, and that failure to offer this support with cause long-term economic damage by destroying small businesses and driving people out of self-employment. With the vaccine offering hope of a return to normality quickly, the cost of a few months of extra support must be weighed against the likely damage caused if no action is taken.

Community’s General Secretary, Roy Rickhuss CBE, said:

“Our findings must serve as a catalyst to ensuring that those self-employed workers who have so far missed out on government support, urgently receive it.

“Over 60% of self-employed workers feel less likely or unsure they want to be self-employed or freelance in the future. This would be nothing short of a disaster for our economy, prospects of an economic recovery and the livelihoods of thousands of working people and their families.

“Government must wake up to these figures and act immediately on our recommendations to ensure that thousands of self-employed people are not plunged into further financial hardship as a result of this pandemic, and that this vital section of the UK workforce continues to play a fundamental role in our economy.”

Notes to editors

The data is based on a survey of over 2,500 self-employed and freelance workers conducted online during October and November 2020.

The Inquiry took evidence from self-employed workers and groups affected by the crisis, policy experts and a mass survey of the self-employed.

These are interims recommendations and do not necessarily reflect the views of every member of the commission.

The final report of the Inquiry is due in February 2021.

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