Rise in self-employment driven by older workers, says IPPR economist
Hywel Roberts, August 13, 2014
An increase in UK workers turning to self-employment is driven by older workers looking for flexibility, according to Institute of Public Policy Research (IPPR) senior economist Spencer Thompson.
Figures released by the IPPR have revealed the number of self-employed workers increased by 8% from the first quarter of 2013 to the same period in 2014. This is the highest jump in Western Europe, followed by Switzerland at 5%.
Thompson told HR magazine the increase is due in part to people delaying their retirement and taking advantage of the flexibility self-employment provides to complement their retirement savings.
"With low interest rates and the state pension age for women rising, retirement savings are getting squeezed," he said. "So people are looking to earn some more money before or partially during their retirement."
Thompson added that the unemployed sometimes go into self-employment "as a second choice" because they can't find work as employees.
"With around 2,000 people coming off jobseeker's allowance to self-employment every month, it's something that's fairly common now," he added. "But often people take this option simply because they can't find employment. So it's not quite as simple as saying this is just becoming a more attractive option."