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Self-employed affected most by COVID19 lockdown

Published:?22?April?2020
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Photo: Julia M Cameron

New research has highlighted how the lockdown measures brought in as a result of the COVID19 pandemic could increase social inequality in employment in Britain. The findings show that within the sectors most at risk, self-employed people will be most affected with women affected more than men.

The research by Dr Darja Reuschke from the School of Geography and Environmental Science at the University of Southampton and Professor Andrew Henley from the Cardiff Business School at the University of Cardiff identifies groups of workers that are most likely to be hit by the current business closures and social distancing measures. The study advances previous predictions on the effects of the lockdown on employment by including the self-employed and looking at the regional variations in the effect of the crisis.

The Institute for Fiscal Studies has recently reported that sectors directly affected by the lockdown are customer-oriented personal and domestic services including non-food, non-pharmaceutical retail; accommodation and food; childcare and much of the arts and leisure sector.

Self-employed people are most likely to work in these ‘at risk’ sectors. Using the most recently available employment data for the UK (the UK Quarterly Labour Force Survey) this new study shows just over one million of the country’s self-employed workers (22%) are at risk of being affected by the shutdown. Almost one-third of self-employed women are at risk and particularly concerning is the high-risk rate among young women between 16-29 of age and those between 30-44 of age who are likely to have families and mortgages. In the workforce as a whole, young people (16-29 years old) are more likely to work in ‘at risk’ sectors than older workers. The self-employed, however, are in all age groups (between 16-64 years old) more likely to be affected by the crisis.

The researchers also found significance based on education levels, with those having a degree being least affected. The protection from employment risk for degree holders is significantly increased compared to other education qualifications and the gap is huge compared to those with low or no qualification who are affected the most. Having a degree is associated with high-skilled work that also allows people to work from home.

Furthermore, the study shows regional differences in the severity of the crisis on employment, with London and Scotland being significantly more at risk than other regions. Employees in London are specifically affected compared to other regions. However, for the self-employed the regional pattern is different. The self-employed are likely to be hardest hit in the North East – and significantly less so in London and the South East. Spatial inequalities in entrepreneurial potential are therefore likely to be reinforced.

Commenting on her finding, Dr Reuschke said, “This study highlights the protection having the facility to work from home gives to employees. The findings should encourage employers to take further steps after the crisis to promote this flexible working arrangement in the future as they cannot always rely on Government support if their employees are unable to carry out their roles from home.

“Young workers and the self-employed need particular attention from policy makers in this current crisis. It will be particularly important to give young people employment and career support. The Higher Education sector and the opening up of opportunities for acquiring higher skills will play a key role in preparing for future crises. For the self-employed, the quick roll-out of temporary earnings support will be vital under the current circumstances.”

The report "Covid-19 and self-employment in the UK" is available here.

 

 

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