Self-employment: another area we need to understand

I’ve just been to a stimulating meeting at the Resolution Foundation, which always provides food for thought on employment issues.  This one was on self-employment, which now counts for over 15% of the workforce – some 4.5 million people. As Gavin Kelly, the FR’s CEO, observed, when you have numbers of that kind routinely left out of most labour market analysis, it makes one query how robust the conclusions can be. Add to that the absurdity of using 16-64 as the age frame; and then pile on the limitations of the simplistic binary division between full-timers and part-timers and you reality begin to think that we need a radical rebuild of our categories for collating and using statistics on work.

Numbers of the self-employed have grown by about 2/3 of a million since 2008. The proportion of women has gone up from 23% to 28%. As a Fawcett Society staffer pointed out, the gender pay gap for the self-employed is around 40%. So it’s all very PP-relevant.  One argument says that women are more successful in setting up their own small businesses because they have more experience in running the small businesses called families.

Does this trend to self-employment herald a brave new dawn of autonomous entrepreneurialism? Or is it a dismal reflection of the fragility of the labour market? The general consensus at the RF meeting was that it covers a huge diversity of experience, making generalisations and averagings dangerous. One striking fact was that the UK is towards one extreme within OECD countries in the size of its self-employed group – probably a reflection of our less regulated labour market. For what it’s worth, my view is that it’s more about people making what they can of very difficult employment prospects, with the enthusiastic entrepreneurs a minority. Most self-employed want to work more hours, which suggests a level of underemployment. But it’s undoubtedly a variegated picture.

There was one brief mention of training. The self-employed are certainly a big enough group for those of us interested in lifelong learning opportunities o take them seriously. How good is their access to training, and how might this be supported? Technology certainly helps, but it seems to me likely that many would welcome local opportunities which would help them acquire the skills they need.

Finally, it was good to meet there the author of Flipchart Fairytales, an excellent source of information and reflection on all kinds of employment issues.