John Harris

Journalist & Author

Self-employed business opportunity? No thanks | John Harris

David Cameron’s support for entrepreneurs can’t hide the reality of self-employment, nor mask the erosion of proper jobs

Rejoice, rejoice. No matter that the economy shows little sign of revival: the petit bourgeois spirit that led Napoleon to malign us as a nation of shopkeepers seems in unprecedented health. Since the middle of the last decade, the number and proportion of self-employed Britons has been increasing, and the drastic events of 2008 did not slow the rise. Quite the reverse in fact, and thanks to a report last week by the Chartered Institute of Personnel and Development, we now know that by last autumn UK self-employment had reached 4.14 million: a record that will surely cheer up anyone who believes in hard work and self-reliance.

This week David Cameron will once again make a show of his support for an initiative called StartUp Britain, after paying tribute to its ethos in his “popular capitalism” speech last week: “If you take a risk, quit your job, create the next Google or Facebook and wind up a billionaire, then more power to your elbow.” The inestimable Richard Branson is also on the case, suggesting that the government start offering finance to young would-be entrepreneurs on the same terms as student loans. He appeared on Radio 4 last Friday: what, wondered the presenter of the World at One, if they end up not just bust, but with a mountain of debt? The answer was apparently beamed in straight from Necker Island. “I would recommend they just pick themselves up, learn from that failure, try again, and keep trying until they succeed,” he said.

As happened in the Thatcher years, we are awash with such talk, just when going it alone is more difficult than ever – and, moreover, the grim truth about most new self-employment has just been revealed. “The additional self-employed are unlike self-employed people as a whole in terms of gender, hours of work, occupation and sector of employment,” says the CIPD’s report. Tellingly, of those who make up the net rise in self-employment since 2008, 90% are part-time. Moreover, the report’s author, John Philpott, talks about people “without skills, picking up whatever bits and pieces of work are available”, whose emergence “hardly suggests a surge in genuine entrepreneurial zeal.”

All this has been boiled down to talk about a new crop of “odd-jobbers” – but there’s something more important going on, so far undocumented in official statistics: the accelerated conversion of proper jobs into a mess of “self-employment” that’s completely fraudulent. Eighteen months ago, two Daily Mirror journalists began a brilliant campaign on this issue titled “Gizza Proper Job“, and exposed such firms as Ryanair and the minicab firm Addison Lee; it has also been touched on by BBC1’s Panorama. That it remains a political non-issue says a lot about the current debate about the supposed fundamentals of the economy: politicians and the press will happily fume about either overpaid executives or ripped-off customers, but thinking about the nitty-gritty of working lives is still somehow beneath them.

“We are looking for a number of door supervisors, security guards and CCTV operatives,” says one typical online job ad. “You will be employed on a self-employed basis”. This from the suburbs of Bristol, and another trade long steeped in such sharp practice: “Self-employed hairdressers are required for a busy, newly opened and re-vamped Beauty Salon.” A lot of ads predictably push the supposed merits of “being your own boss” – but in most cases the boss is where he’s always been, only he’s found a neat new way of paying you less.

With unemployment so high, entering this world entails pay rates that often seem to be in freefall. At the heart of the self-employed economy in construction, for example, one 2010 survey recorded plummeting freelance wages, some down by as much as 50%. And the rest, we know. By definition, there’s no need for employers to pay national insurance, or provide sick pay, maternity leave or holidays; if you’re on commission, you won’t even get the minimum wage. Even bottom-rung pensions are likely to be off-limits. God help you if you are ill. And how you are meant to push your way into, say, home ownership is anyone’s guess.

The most grimly hilarious ad I found on a recent trawl read as follows: “Make £275 or more per trip as a Courier Driver, delivering same-day documents and parcels across the UK … Please note this is not a job, this is an self-employed business opportunity.” Lovely, that last turn of phrase. Where once were jobs are now “self-employment business opportunities” – though little chance, while you’re speeding around the country delivering other people’s parcels, of turning yourself into the next Branson, Sugar or Dyson.

The question is whether the mushrooming of this side of the job market will dwindle with the current crisis, or be embedded in the economy for good. Last week, one high-up from the Recruitment and Employment Confederation identified an increasing national trend “towards more freelancing and flexible working patterns” and also wondered whether we’re seeing “a lasting reconfiguration of the employment landscape in the UK”. From what we know about our old friend irresponsible capitalism, it’s surely a certainty.

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