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SELF-EMPLOYMENT - WHAT SHOULD GOVERNMENT DO TO SUPPORT THIS VITAL SECTOR?

With less than two weeks to go until the general election,  one of the key battlegrounds for the political parties is the economy.

Certainly, and against the expectations of some economists six years ago, there has been a massive recovery in employment since 2010. Indeed,  more than 2 million new jobs being created in the private sector economy following one of the worse recessions in living memory.

A significant part of this growth is down to those individuals who have decided to work for themselves. Indeed, official statistics show that there were 4.6 million people classed as self- employed in 2014 (or 15 per cent of those in work).

In addition, there were another 356,000 employees who had a second job in which they were self-employed. This is the highest level ever recorded since the government started collecting this data forty years ago.

More importantly, self-employment is reaching all parts of society. For example, despite the historical gender gap in those starting their own business, the number of women in self-employment is now increasing at a faster rate than the number of men. However, many do not go further than just working for themselves and there needs to be a greater focus on female specific business services that can support self-employed women to take the next step into being employers

And whilst the success of high technology firms means that enterprise is seen as a young person’s game, the number of over 65s who are self-employed has more than doubled in the past five years to reach nearly half a million.

Not only has the success of  organisations such as Prime Cymru helped this trend through their excellent support but the growth amongst this population group looks set to continue over the next few years due to recent legislation changes.

Only this week, the finance company Axa Wealth suggested that the new pensions revolution could spark a wave of "silver start-up" businesses, with one in 10 people approaching retirement considering drawing money from their pension to start a small business.

The occupational profile of the self-employed has also been changing and not only are such individuals to be found amongst builders and taxi drivers but also increasingly in white collar roles such as management consultancy, book-keeping, photography and chartered accountancy.
But despite the growing importance of this vital group of workers, are the concerns of the self-employed being considered by politicians in the run-up to the next general election?

The UK Government has looked to support self-employment through introducing schemes such as the New Enterprise Allowance which provides money and support to help those on certain benefits to start their own business. In addition, the start-up loans scheme has supported those who wish to enter self-employment with the small amounts of capital to get them up and running.

But could more be done to help this group of workers?

According to the Association of Independent Professionals and the Self-Employed (IPSE), which is the largest association of independent professionals in the EU, there remain a number of issues that they believe the next government should consider in boosting the self-employed sector.

First if all, there needs be greater support for those women choosing self-employment, especially given the recent growth in this area. In particular, there should be a re-evaluation of the way that self-employed women are treated when it comes to policies such as availability of maternity benefits, which are currently less advantageous than to employees caring for a child.

Like many small firms, the self-employed should receive greater protection in terms of late payment, especially in terms of ensuring that they can report offenders anonymously so that they do not place any trading relationship in danger.

Given that the biggest growth in self-employment has been amongst young people, there needs to be a greater focus on this area. Whilst the start-up loans programme has helped those aged 18-30 years old to get access to finance, it is clear that schools, colleges and universities need to do more to provide them with the knowledge and skills that are needed to enter the world of self-employment.

In addition, with co-working spaces are becoming increasingly popular among the self-employed, councils need to be incentivised by the UK Government to ensure that any empty property they own can be utilised for use by those starting and owning their own businesses.There also needs to be flexibility in planning laws so that those shops that remain empty across the high streets can be changed to co-working spaces that can be used by the self-employed.

Finally, IPSE believes that the UK should appoint a Minister with a specific focus on the needs of this group that although unlikely, could be a role that future Minister for Business could be involved with in the future

Therefore, with five million self-employed people ready to vote on May 6th, it is clear that they are an important voting block in any election. Certainly, it is time our political parties gives them greater consideration when it comes to the creation of specific policies that support their efforts in developing the economy.

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