The rise in job levels since the recession are driven by surge in self-employment

24 Jan 2013, by Anjum Klair in Labour market

TUC analysis shows that since the start of the recession in 2008 the small rise in employment levels has been driven by a nine per cent rise in the number of self-employed workers. Over the same period, the number of employees has actually fallen by one per cent. The latest data shows a slight improvement in the number of employed workers, however since the start of the recession the number of self-employed workers have increased by 333,000, the number of employees has fallen by 201,000.

Total employment levels, 2008-12

Since early 2010, nearly 40 per cent of the new jobs created have been self-employed roles, even though just 14 per cent of workers are self-employed. The TUC fears that this sharp rise in self-employment could be masking the true extent of unemployment as people previously in work ‘go freelance’, start their own businesses or are forced into false self-employment, rather than sign on.

Self-employment is up across the economy, with significant increases in all areas of work. The largest increases have been in administrative and secretarial work, sales and customer service roles and personal service occupations, such as hairdressing, cleaning and care work. The concern here is that rather than running their own businesses, many people could be undertaking false self-employment, doing the same work as contracted employees but on poorer terms and conditions.

Self-employed workers by occupation, 2008-12

Source: ONS

There is a difference between the total number of self-employed people between the two tables because of variations in sample size between the two questions.

Total change in employee and self-employed employment levels since 2008 is less than the total employment change as the latter also includes unpaid family workers (+1,000 since 2008) and workers on government schemes (+52,000 increase 2008).