Who are the UK’s self employed? New research sheds light on those working solo

Eight of the nine segments of self-employed people, who employ no one, say they are as satisfied, or more satisfied, than employees doing a similar job

New research from the Centre for Research on Self-Employment (CRSE), in conjunction with the Institute for Employment Studies (IES), has revealed the make-up of the UK’s self-employed community.

The report, which has identified nine distinct segments which divide the UK’s broad solo self-employed population, has revealed that those who work for themselves can be segmented according to variations in earnings, levels of independence and how much security their working situation provides.

Despite the disparities, however, entrepreneurs and those that choose to ‘be their own boss’ do on the whole appear to be happier than those that work for someone else.

Eight of the nine segments of solo self-employed, those who employ no one, are as satisfied, or even more satisfied, than employees doing similar jobs – with 53% of the solo self-employed workforce exhibiting high levels of independence and security.

Just 15% of solo workers are thought to exhibit little autonomy or control over their work – with suggestions that more should be done to clarify their employment status.

More worryingly, one in five self-employed workers – amounting to over 825,000 people – are also classified as insecure.

More likely to be found among the UK’s cleaners, drivers, carers and labourers, as well as those in artistic occupations, such people tend to be less qualified and are much less likely to have financial security such as a private pension.

What do the UK’s self-employed work as?

  1. Low pay, dependent, insecure | 348,200, 8.9% of solo self-employed: More likely to become self-employed because they couldn’t find other employment, those in group one have lower than average levels of autonomy and control over their work  Jobs include drivers and cleaners.
  2. Low pay, independent, insecure | 320,600, 8.2% of solo self-employed: With just 7% of people in this bracket having no qualifications whatsoever, self-employment was an overwhelming choice. However, those in group two have lower than average earnings compared with the average across all segments. Jobs include shopkeepers, car mechanics and artistic occupations.
  3. Low pay, independent, secure | 889,900, 22.7% of solo self-employed: A heavily male dominated segment (87%), group three exhibits a relatively high degree of autonomy yet have below average earnings. Jobs include farm workers, tutors, traders and builders.
  4. Mid pay, dependent, insecure | 156,500, 4% of solo self-employed: Despite reporting the highest level of job satisfaction, those in group four have below average levels of autonomy, particularly relating to work manner and hours. Just 12% have a private pension. Jobs include childminders and carers, and building labourers.
  5. Mid pay, dependent, secure | 50,900, 1.3% of solo self-employed: Workers in this group have low qualifications (16% with above A-levels, compared with the 39% average across all segments). People in this segment report below average autonomy for many aspects of work. They earn above average compared to other segments, but less than their employed counterparts do. Jobs include building operatives/drivers.
  6. Mid pay, independent, secure | 767,700, 19.5% of solo self-employed: Reporting the highest levels of autonomy relating to job task, work pace, task order and work hours. Median earnings are similar to the average across all segments, but much lower than employees in similar roles. Jobs include trainers, IT professionals, financial advisers, hair and beauty, skilled makers, gardeners, restaurant and B&B owners.
  7. High pay, regulated, secure | 77,800, 2% of solo self-employed: A highly qualified segment (87% with degrees) with only 2% becoming self-employed due to a lack of employment opportunities. They are more likely to have a private pension and report higher levels of job satisfaction than employees. Most are medical professionals.
  8. High pay, mid-independence, secure | 198,400, 5.1% of solo self-employed: Highly qualified, most professions in this segment have average levels of control and autonomy. Jobs include functional managers, TV/film technical roles, construction and property managers, book-keepers.
  9. High pay, independent, secure | 162,400, 4.1% of solo self-employed: The highest paid segment, people in group nine work in the legal and business sector with high levels of autonomy and control.

Nigel Meager, director of the Institute for Employment studies, said:

“There are almost five million people working for themselves in the UK.

“Coverage of this group in the media and political debate often focuses on the gig economy, which is in reality only a small part of a dynamic and far broader self-employed workforce.

“The findings show huge differences between segments of the self-employed in many areas including earnings and job security, as well as work/life balance and overall satisfaction.

“I hope the findings encourage policy-makers to take this diversity into account when developing support for the self-employed as well as any regulations that could affect them.”

Suneeta Johal, director of the Centre for Research on Self Employment said:

“Different segments of the self-employed need bespoke support to improve their position. For example, those who lack independence and are financially insecure need urgent support and incentives to save for their future.

“The groups with little independence in their work would also benefit from a statutory definition of self-employment, which would help to clarify their employment status.

“All segments of self-employment could really benefit from better access to training and skills development opportunities.

“Not only does skills development improve pay prospects, it also allows the less autonomous self-employed to move into more independent roles or build themselves a broader base of clients.”