Europe, UK (Commonwealth Union) – Self-employment can take many different forms, from freelancing and consulting to owning a small business. While self-employment provides greater flexibility and independence than traditional employment, it also comes with challenges such as the need to find clients and manage finances. Successful self-employment requires a combination of skills, including self-motivation, discipline, and the ability to manage risk and uncertainty.
These challenges have been reflected in a new study in the UK, from a recent analysis of self-employed individuals in the UK, co-authored by the University of Liverpool Management School, demonstrating an exodus of persons engaged full-time or who employ others, while most staying in self-employment have been feeling the impacts of declining incomes and profits.
“From Covid-19 to collapse? The self-employed and the cost-of-living crisis”, was published recently by the Centre for Economic Performance (CEP) at the London School of Economics and Political Science (LSE), shows that the share of self-employed individuals who are facing difficulty paying for the basics, increased since April 2022. Over 2 in 5 report that energy bills are presently a major challenge.
The study, drew from a representative sample of 1,500 people in the self-employed population, further increased concerns in regards to pension savings among the self-employed.
Roughly 3 quarters of the group fail to make contributions to a personal pension scheme, with the absence of a sufficient income being indicated as the main reason.
The authors evaluated the views among those self-employed on a government-backed pension scheme. It was discovered that that the self-employed may choose to contribute up to 5% of their earnings, given that a government bonus contribution of 3% is available. Nearly half of the self-employed having annual incomes generally over £10,000 and a 3rd of those with lower incomes would provide to a scheme if these conditions were met.
