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Freelance sector “flatlining” in the run-up to Brexit

The freelance sector is “flatlining” because of Brexit pressure, research from IPSE (the Association of Independent Professionals and the Self-Employed) and PeoplePerHour has found.


The latest Confidence Index shows that not only is freelancers’ confidence in the wider economy stuck in deep negative territory; their confidence in their own business performance is low and their pay has slumped since last year.

After an unexpected boost at the end of 2018, freelancers’ pay slumped by 17 per cent in the first three months of 2019, and remained almost unchanged this quarter.

Freelancers are also finding less work than they were during the surprise surge at the end of last year. In Q4 2018, freelancers were on assignment 79 per cent of the time, but this fell to 75 per cent last quarter and has remained completely unchanged.

Confidence in the wider economy is also stuck in deep negative territory. Although freelancers’ confidence in the economy over the next three months rose slightly, from -36.3 to -27.4, they remain deeply pessimistic about the performance of the economy over the next 12 months (-38.0). One reason for the difference between the two scores could be the belief that there is likely to be some movement on Brexit soon.

Freelancers’ confidence in their own businesses is marginally positive in the short-term but low in the longer-term. Confidence in business performance over the next three months rose from -0.7 last quarter to 3.5 this quarter. Confidence in business performance over the next year, however, dipped slightly from -6.1 last quarter to -6.7.

The long-term gloom is deepened by the fact that 70 per cent of freelancers predict their business costs will increase over the coming year.

The main reason for this pervasive stagnation seems to be Brexit. Freelancers cite Brexit as the biggest factor holding back their business performance, closely followed by government fiscal policy relating to freelancing. The third-most important negative factor was government policy relating to hiring freelancers.  

Ryan Barnett, IPSE’s Economic Policy Advisor, commented: “This quarter, we find a freelance sector that is flatlining in the face of Brexit. Back at the end of 2018, Brexit uncertainty gave freelancers a boost as it drove clients to them instead of taking the risk of hiring permanent staff. This quarter, however, we are clearly well past that phase.

“The chaotic uncertainty of Brexit has now settled on freelancers. Confidence in business performance and in the wider economy is stuck in firmly negative territory. Pay, too, has dropped sharply from the Q4 2018 surge, as has the amount of work freelancers are getting.

“The level of prolonged and profound uncertainty we are experiencing is uncharted and dangerous territory for freelancers. It’s led to the sector flatlining across a range of measures. But there is still a risk that things could get worse.

“80 per cent of freelancers are opposed to a no-deal Brexit because they know the immense damage it could do to their businesses. What the freelance sector needs from government now, like the rest of business, is a way out of this chaos that does not lead to the disaster of a no-deal Brexit.”

Xenios Thrasyvoulou, founder and CEO of PeoplePerHour, commented: “The uncertainty looming over Brexit is causing an important part of our economy to stagnate over the last two quarters, which is not good for business or freelancers. This comes after policies like IR35 which have also done little to increase confidence and certainty.”

“It is imperative that a clear direction is taken on Brexit to help minimise damage to this important sector to set the way for freelancers to flourish again. We urge the government to find a suitable solution for the ongoing Brexit mess. A no-deal Brexit would be disastrous for the freelance sector, and would only add to the anxiety and uncertainty that freelancers are currently facing.”

Confidence Index Q2 2019


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IPSE is the leading association for contractors, consultants, interims, freelancers and the self-employed. We strive to bring our members the most comprehensive and useful range of information and services and all the latest news about what affects your business.