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Understanding your sector
Understanding your sector

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5 Self-employment

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Figure 5

So far, you have been considering the job market in terms of getting a paid job with an employer – but there are alternatives. One of the most important of these is self-employment. After a period of growth over a number of years, the number of solo self-employed in the UK (excluding those who have others working for them) fell by five per cent from 4.6 million in 2019 to 4.4 million in 2020, with impact felt from the panademic and Brexit amongst other factors (IPSE, 2020). As of June 2021, there are approximately 4.2 million self-employed workers in the United Kingdom.

The option of self-employment appeals to many people, despite some evidence that people can be pushed into self-employment by circumstance rather than choice, resulting in low pay and limited training. For parents seeking more flexible work regimes or older workers looking to top up their pensions, however, working independently can provide an easier route into the labour market than traditional employment. Whether this is the case for you will depend on factors such as your personality type and the business or area in which you are, or are aiming to be, involved.

If you prefer the security of an employer who will pay you a regular income, organise your work schedule and take care of HR issues, such as pensions, tax, sickness and holidays, then you might struggle having to look after these areas for yourself. If, however, you are self-motivated and like to take control of your working day, enjoy organising your time and are happy with the administration involved in dealing with HMRC and other government bodies, then you might decide that self-employment is an option to consider. It is worth thinking through the advantages and disadvantages of self-employment from your personal perspective.

Certain business areas or industries are more likely to have self-employment opportunities than others, so you need to carefully research the potential within your chosen field. Many traditional skilled trades – for example electricians, plumbers and hairdressers – are characterised by self-employment, as are some artistic and creative fields such as interior and graphic design.

With the widespread use of communications technology, such as the internet and social media, there are growing opportunities for people to work from home across a wide range of sectors at the times that most suit them rather than being tied to a particular employer.

Activity 7 The pros and cons of self-employment

Timing: Allow about 10 minutes

Think about the pros and cons of self-employment in the context of your own situation. Go to the Self-employment questionnaire tool in the Toolkit [Tip: hold Ctrl and click a link to open it in a new tab. (Hide tip)] , read the statements listed there, all of which might apply to self-employment, and select the numbers that are closest to how you feel. Then read the comment below.


These factors will almost certainly be part of your life as a self-employed person, so you need to be comfortable with them. If the majority of your responses are above seven or eight, then you might seriously consider self-employment, other things being equal. Too many responses at the other end of the scale, below five for example, and there would seem to be some doubt about your ability to manage or enjoy the challenge. Of course, you may answer differently in several years’ time, in changed circumstances, so self-employment may be an option you reconsider in the future.

Self-employment in the UK is increasing as a way of earning your living and for many people has considerable advantages, including flexibility and autonomy. It is an area that you might not have considered before and could be worth investigating. It is not appropriate for everyone, however, and should be considered alongside other, more traditional, employment options.