Self-employed confidence continues to grow

Confidence among the self-employed is on the rise for the first time in two years, despite Brexit fears, economic pressure and falling day rates.

The latest Confidence Index, carried out by the Association of Independent Professionals and the Self-Employed (IPSE) and PeoplePerHour (PPH), revealed that during Q2, contractor’s confidence in their business performance in the next 12 months saw a significant rise, increasing from -3.9 in Q1 to 5.3 and making it the highest business confidence reading since Q4 2015.

According to the research, these results are particularly surprising due to the fact that contractors are facing a number of issues, including average day rates dropping from £430 last quarter to £394 and the majority (three quarters) of contractors expecting their business costs to increase by 13.7% in the next 12 months.

Suneeta Johal, IPSE Head of Research, commented, “Although there is clearly much to be concerned about here, freelancers’ rising confidence in their businesses is extremely heartening. Against all odds, they now have the highest confidence outlook for their business level since before the EU referendum. Their well-known resilience and determination is doubtless a key factor behind this – along with the fact that, as IPSE’s research has shown, there is more to self-employed work satisfaction than money.

“Self-employed people’s confidence in their businesses is high, but it is not unshakeable. Given the negative forces ranged against the self-employed right now, the Government should make it a priority to reassure and support them. With Brexit named as the main factor dragging down self-employed confidence in the wider economy, the Government should make securing a Brexit deal that works for the self-employed a key priority. It should also work to restore self-employed confidence in its own policies – not least by stepping back from any plans to extend the disastrous changes to IR35 to the private sector.”

Xenios Thrasyvoulou, founder and CEO of PeoplePerHour, added, “Freelancers, by their very nature, are optimists and problem-solvers, so the fact that they’re able to find positivity in the face of relatively dismal figures perhaps shouldn’t surprise us. But it does make their fears over Brexit all the more telling.

“Fifteen per cent of the UK workforce now freelance in some capacity, full or part-time. The fact that this could be threatened by poorly planned Brexit strategies, or a return to further discussions of IR35 – as some politicians have hinted at – is deeply concerning.

“Freelancers’ business confidence for the next twelve months has risen in the last quarter. It is now incumbent on the Government to make sure that it does not return to post 2015-levels. We all need to better appreciate the contribution that the freelance network makes to our economy and our society.”

To find out more about contracting please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.