“Today’s figures show the annual increase in the number of self-employed people is two-thirds larger than the increase in the number of employees.
“With 182,000 more people in self-employment than the previous year, the total number of self-employed people now sits at 4.96 million, and the UK is fast approaching the 5 million milestone. That’s 5 million people excluded from the benefits of auto-enrolment.
“While the Conservatives made no commitment to improve pensions for the self-employed in their manifesto, it can’t be sustainable to allow them to continue to have no ‘default’ private pension. Only 31%* of self-employed people currently save into a pension and unlike counterparts in traditional employment, they are not benefiting from valuable employer contributions.
“The rise in the self-employed has been a significant feature in the labour market over recent years and follows the emergence of the gig economy and technological advancements that have allowed for more flexible working patterns. However, 3.5 million are full-time self-employed so the numbers are not simply a reflection of individuals taking on part-time self-employment in addition to regular employment**.
“The growth in the self-employed does not come without significant challenges, particularly when it comes to saving for retirement. There is a clear divide between employees enrolled into a workplace pension and the self-employed who do not benefit from auto-enrolment and the boosts to their retirement savings that come with this such as the employer contribution. Much more is needed to be done to address this inequality and make pension savings the ‘default’ for these workers.”
References:
* https://www.moneyadviceservice.org.uk/en/articles/pensions-for-the-self-employed
**https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/datasets/fulltimeparttimeandtemporaryworkersseasonallyadjustedemp01sa
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