By: Emma Tait-Barber

Freelance recovery underway, as sector grows for first time in over a year

Having shown tremendous resilience throughout Covid-19, the latest job market statistics signal the first month-on-month rise in the number of freelancers in the UK since the start of the pandemic – a trend that one industry expert has said gives the sector “cause for cautious optimism.”

ONS Labour Market Statistics for January to February 2021 shows a slight increase in the number of people working for themselves in the UK, which rose from 4,313,000 to 4,331,000. While this uplift was marginal at best, the fact that the self-employed workforce is growing once more after such a difficult period is something to celebrate, explained the representative body, IPSE.

What’s more, the increase in the number of people striking out on their own is being driven by female freelancers, whose population increased from 1,546,000 to 1,576,000 over the same period. According to IPSE, growth across the board offers “hope that the freelance sector is on its way back.”

Growth supported by upturn in freelance business performance

Research carried out by the membership organisation supports the view that the freelance recovery is in full swing.

Nearly a quarter (24%) of freelancers and contractors said their businesses have returned to pre-pandemic levels already, with just under a third (29%) optimistic that the easing of lockdown will boost their business performance. Meanwhile, around one in five (19%) of independent workers said they had been largely unaffected by the pandemic.

IPSE’s Director of Policy, Andy Chamberlain, said the data shows that freelancers are “seeing a big boost to their businesses because of the Roadmap and opening of the economy.”

Government must “unleash” full freelance potential

There is, of course, still a long road ahead. While more people working for themselves and positive feedback from freelancers is good news all round, IPSE pointed out that there is still some way to go until self-employment recovers fully.

For example, the independent workforce is 617,000 smaller in size when measured against the same time last year. This is why the government must do more to support the millions of people brave enough to strike out on their own, Chamberlain explained:

“To unleash the full economic potential of the sector, there is a clear need for government to look again at the damage done by the pandemic – particularly the issue of debt relief – and also the impact of the IR35 changes, and consult on a long-term plan for the future of the freelance sector.”

IR35, Brexit and pandemic still at forefront of freelancers’ minds

Recent IR35 changes are fresh in the minds of freelancers and contractors, with 79% telling IPSE they were concerned about the impact of reform on their business. Brexit (37%) is also a big worry for those surveyed.

While there is light at the end of the tunnel regarding Covid, and many freelance businesses have now recovered, independent workers are aware of the threat the virus still poses. And the reality is that lots of freelancers are still concerned about or suffering from the impact of the pandemic.

The research shows that more than half (51%) are worried about winning new clients, over a third (37%) fear reduced demand for their services despite recent economic growth, with another third (36%) wary about a possible third wave.

Even so, with all things considered, this insight – which closely follows another IPSE study showing a 20% rise in quarterly freelance earnings in Q1 of 2021 – is a clear sign that independent workers are, as Chamberlain put it, “raring to go and ready to drive the recovery.”

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