Self-employment in the UK shows year-on-year growth

The number of self-employed people in the UK has grown by almost 64,000 year-on-year, new official figures show.

Analysis of the data from the Office of National Statistics (ONS), which has today released employment numbers for April to June 2023, shows it is the fourth consecutive quarter of year-on-year growth.

Although self-employment is still approximately 700,000 people down on what it was before the onset of COVID-19, four consecutive quarters of year-on-year growth is the first time that has happened since the beginning of the coronavirus pandemic.

According to the Association of Independent Professionals and the Self-Employed (IPSE), there are now 4.3m self-employed people operating in the UK compared to around 5m before the pandemic.

Emma Jones, founder of Enterprise Nation, said:

"Our own research shows the appetite to become your own boss is growing strongly. At the beginning of the year, an Enterprise Nation report found a third of all adults were looking to start a business or launch some form of enterprise this year, with that figure rising to 48% for the 18 to 24-year-old age group.

"Around 45% of businesses are started as a side hustle today - people who are holding down a full or part-time job while building their enterprise in their spare time.

"The ONS figures show how self-employment is partly responsible for the decrease in economic inactivity, which is a positive step for our economy.

"While the cost of living crisis has clearly put pressure on people's pockets and partly driven this trend to increase earning power and income - it's also because people want to use their skills and passion to work towards something they believe in and build for the future.

"Accessing relevant business-building tools to support growth is going to be vital as we see more people, not less, becoming their own boss."

Andy Chamberlain, director of policy at IPSE, added:

"We know that people choose self-employment for overwhelmingly positive reasons, whether it’s to follow a passion or strike a better work-life balance; that more and more people are choosing to work in this way is something to applaud.

"But it also highlights the need to urgently tackle the biggest threats to self-employed businesses, such as a punitive tax system, late paying clients, and the soaring cost of living."

The ONS data show overall UK unemployment increased to 4.2% in April to June, up 0.3 percentage points compared to the previous three-month period.

The number of job vacancies fell by 66,000 between May and July, but wages rose at a record rate. Regular pay increased by 7.8% which is the highest yearly growth since records began in 2001.

Wage growth, however, has not kept up with price rises. Inflation was 7.9% in the year to June.

Relevant self-employment resources

Download a free guide to becoming a freelancer consultant or adviser

Download a free guide to starting a side hustle

Visit the StartUp UK hub for more small business resources and advice