Self-employment: decent wages so last century


Figures out this week reveal that the growing ranks of the self-employed (now 1 in 7 of today’s workforce) are earning less than they were 20 years ago. We’re not talking an inflation-adjusted real-terms fall in wages here – they actually have less money in their pockets.

As pointed out previously on this blog, average earnings from self-employment are less than half that of employees. The new analysis by the Resolution Foundation shows that average self-employed wages were £240 a week in the 2014-15 financial year, against around £300 a week in 1994-95.

"Britain's new generation of self-employed workers are not all the budding entrepreneurs ministers like to talk about, “ says TUC general secretary Frances O'Grady. “While some choose self-employment, many are forced into it because there is no alternative work. Self-employment today too often means low pay and fewer rights at work."

Self-employment in the UK has rocketed in recent years. Nearly five million UK workers are currently self-employed. The vast majority are not freelancers of their own free will. An increasing number are working in the so-called ‘gig economy’ providing ‘on-demand labour’ as, for example, taxi drivers, couriers, hairdressers or construction workers. The rapid trend towards casualised employment with weak rights and low pay means that permanent, full-time payroll jobs have become increasingly hard to come by. There may be more jobs out there, but fewer and fewer of them are secure or pay a decent wage.

Prime Minister Theresa May says she wants the labour market to support and protect all workers. For the sake of millions of struggling self-employed and other insecure, casualised workers, she needs to make good on this aspiration – and fast.