700,000 self-employed workers have stopped working entirely during the current lockdown 14 February 2021 Almost one-in-seven (14 per cent) self-employed workers – equivalent to 700,000 workers across the UK – have stopped working entirely during the current lockdown (January) – a 50 per cent increase from the one-in-eleven (9 per cent) self-employed workers who stopped working during the first lockdown in May – according to a major new Resolution Foundation report published later this week. The report – supported by the Health Foundation – includes an examination of the scale of the economic shock to self-employed workers, eleven months into the crisis. It shows that the labour market hit from the crisis has affected self-employed workers across the economy. Almost one-in-six (18 per cent) workers have stopped working in shutdown sectors of the economy in January, along with over one-in-ten (11 per cent) in other sectors of the economy. This severe labour market shock has led to a huge living standards hit to self-employed workers. Over two-in-five (41 per cent) self-employed workers have experienced a fall in earnings of 25 per cent or more during the current lockdown. This is only slightly lower than the proportion of workers who experienced a sharp fall in earnings during the first national lockdown in May (45 per cent). The research shows that the Self-Employment Income Support Scheme (SEISS) is better targeted at affected workers in this phase of the crisis, having previously paid large grants to many who had seen no major fall in income during 2020. Recent changes in the conditions for claiming SEISS have prevented people who don’t need it from accessing it. Just 3 per cent of self-employed respondents stated that the grant more than covered their losses. However, support is still failing to reach a significant share of self-employed workers affected by the crisis. Almost three-in-ten self-employed workers (29 per cent) – amounting to almost 1.5 million people – have lost income as a result of the pandemic, but reported being ineligible for the scheme. Despite the challenges facing self-employed workers during the pandemic, there is little evidence that they intend to leave self-employment significantly more than before the crisis. Currently, almost one-in five (19 per cent) plan to leave after the pandemic. This compares with 16 per cent who left self-employment over an average two-year spell pre-crisis. However, those who have not been eligible for SEISS grants were far more likely to express the intent to leave self-employment (21 per cent), compared to those who did receive a grant (8 per cent). The Foundation says that this further highlights the need for the Government to extend the SEISS to more of those currently missing out due to ineligibility, including those earning less than half their income from self-employment, and the newly self-employed. Some of the additional cost of extending eligibility could be recouped by the Government reclaiming the two-thirds of overpaid SEISS grants from those whose income for this year (2020/21) ended up higher than in previous years. Hannah Slaughter, Economist at the Resolution Foundation, said: “The coronavirus crisis continues to hit the self-employed hard. One-in-seven workers have stopped working entirely during the current lockdown, and two-in-five have seen their earnings fall by at least a quarter. “Eleven months into the crisis, Government support is doing a better job of targeting affected workers, though three-in-ten are still missing out on support, despite losing income. “The Government should extend the eligibility criteria for support to help those who are missing out, as well as clawing back money from workers who received grants during 2020 well in excess of the losses they’ve incurred during the pandemic.” Notes to Editors Figures are from YouGov plc. Total sample size was 6,389 18-65-year-olds. Fieldwork was undertaken online during 22– 26 January 2021. The figures have been weighted and are representative of all UK adults (aged 18-65) according to age, gender, and region. The figures presented here, and in the report, have been tabulated and analysed independently by the Resolution Foundation. They are not the views of YouGov. The figure referring to May is from a previous YouGov plc survey. Total sample size was 6,005 adults. Fieldwork was undertaken online during 6-11 May 2020. The figures have been weighted and are representative of all UK adults (aged 18-65) according to age, gender, and region. The figures presented here, and in the report, have been tabulated and analysed independently by the Resolution Foundation. They are not the views of YouGov. The survey was supported by the Health Foundation, although the views expressed here are not necessarily those of the Health Foundation.
