Trends in self-employment in the UK
In 2017 The Office of National Statistics (ONS) published the results of their analysis into trends around self-employed workers. See the article HERE
The highlight of this analysis was the statistic that in the period between 2001 and 2017, the numbers of workers operating on a self-employed basis grew from 3.3 million to 4.8 million – a jump of nearly 50% in 16 years.
The analysis also covered the characteristics of self-employed workers and identified trends in backgrounds, notably showing an increase from 19.3% to 32.6% in the numbers who are qualified to degree level or above.
As we review this analysis a picture begins to emerge of educated, professionals choosing to take advantage of the flexibility of self-employed status, as opposed to being employed within rigid corporate structures.
Indeed, there are white-collar professions where a self-employed status is the normal, for example in the law profession where statistics from the Bar Standards Board show around 80% of practicing Barristers act on a self-employed basis.
Whilst this movement has been taking place, there has been a change in the employee benefits picture – that is the non-salary benefits employers are now providing to their employees.
Starting with the introduction of Stakeholder pensions in 1997 and the “designated scheme” requirements, which in 2012 were superseded by Auto-Enrolment legislation, employees now benefit from compulsory pension contributions, unless they take the decision to opt-out.
Alongside pension plans and other traditional benefits such as Group Life Assurance, employers are now much more aware of the general health of their staff. Bosses have been motivated by low unemployment figures creating a competitive jobs market and are now providing much more in the form of “Wellness Packages”, to the level that in 2013 record numbers were covered by some form of workplace plan.
If you have chosen a self-employed position, you have chosen to take personal responsibility for your own success and failure in business. Without realising it you have also chosen to take personal responsibility for your retirement planning, life insurance needs and sick pay arrangements.
Ensuring you have replaced any benefits as an employee with appropriate personal provision should form a key part of your financial plan.
For more information on how you can build your financial plan, and what steps you need to take to achieve your financial goals, please contact email@example.com for more information.