Freelancing can be enormously rewarding. The opportunity of working flexible hours, being your own boss and, above all, doing your own thing can be exhilarating and offer a sense of wellbeing that you may not have had from your regular job. Indeed, according to the RSA, 84% of people who are self-employed are more satisfied with their working life than they would have been working for someone else.
But it can be hard. The UK’s 1.6 million freelancers have endless challenges to overcome. On the practical side of things, finding new clients, dealing with tax issues and legal considerations can be a real hassle, while late payments from clients are a constant source of worry. And on the emotional side, freelancers spend huge amounts of time on their own, without the support of colleagues and the conversations around the water cooler that many of us take for granted.
Running your own business is never going to be easy. Indeed, just gathering the know-how necessary to run a business as a sole trader or limited company without any training takes huge effort. But as the freelance market grows – it has increased in size by 40% since 2000 – support for protecting this segment of the economy is also growing. Given (perhaps slightly optimistic) forecasts by PeoplePerHour.com and others that half of the workforce could be self-employed by 2020, this support could not come soon enough.
Technology has started to make life better for freelancers. The growth in freelancer marketplaces (such as UpWork and 99Designs) has made it easier for freelancers to connect with their clients. ‘Co-working spaces’ now provide affordable office space, people to talk to and access to shared know-how. Freelancer-focused book keeping tools like FreshBooks have helped freelancers navigate the tricky world of accounting. And my own business, Juro, is playing a small part in speeding up freelancer payments.
But there is a role for government too in enabling a more fertile landscape for freelancers.
Think ‘freelancer’ and you probably conjure up an image of a trendy graphic designer operating out of East London, charging £500 a day advising start-ups on their websites. It is important to bear in mind though that not all freelancers are highly skilled or highly paid. The recent job creation miracle that we have experienced in the UK entailed in small part the creation of involuntary self-employment. Indeed, some 210,000 people are in ‘under-employment’ – the phenomenon of part-time workers (many of whom are self-employed) who would prefer to be in full-time employment.
For these vulnerable workers, the Government is doing a good job of stripping back unnecessary regulation, helped by its one-in-two-out policy. There are, however, some more ambitious policy plays here. Encouraging banks to consider future capital gains in mortgage lending would be a game-changer for the self-employed, who often cannot raise the funds necessary to buy their own place. Reforms to national insurance and automatic pension enrolments should be on the table. And considering a more holistic approach to UK employment policy to take account of the full spectrum of our modern workforce would be a welcome step.
That currently only 14% of freelancers think the Government adequately supports them is a fact we can no longer ignore. In the digital economy, freelancing will become as mainstream as regular employment. Government needs to be more proactive in creating an ecosystem for freelancers that will boost our productivity, competitiveness and wellbeing and provide much-needed support for those brave self-starters who decide to go it alone.
Richard Mabey is the CEO of Juro, a start-up that helps freelancers cut down on paperwork and get paid on time.