IPSE has responded to ONS data showing a 700,000 drop in the number of freelancers in January compared to the same time the previous year – equivalent to a fall of 14 per cent. IPSE warned the fall shows the self-employed sector is “undermined and disadvantaged” as the economy opens up.

IPSE pointed to the continuing exclusion of up to a million freelancers from the Self-Employment Income Support Scheme (SEISS), as well as the “deeply damaging” changes to IR35 self-employed tax rules as key factors in the state of the sector.

Andy Chamberlain, Director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed), said: “The continuing decline in self-employed numbers at the start of this year shows the drastically poor position the freelance sector is in as the economy begins to open up. In fact, looking at the year-on-year change, the sector has shrunk by a shocking 14 per cent: if this was overall employment, this would be a public disaster. Government must take this seriously.

“It is clear that the ongoing exclusion of up to a million freelancers from SEISS as well as the deeply damaging changes to IR35 tax rules have left the sector undermined and disadvantaged compared to the rest of the workforce and economy. In past recessions, freelancers have been the driving force behind economic recovery and improving employment rates: if Government wants them to play this part again, it must consider new support and stimulus measures to heal this scarred sector.”

ENDS