Introduction
In the last decade, structural changes in the UK economy contributed to the creation of two very significant labour market trends.
On the one hand, the female employment rate in the UK reached 72.3 per cent in November 2019, which is the highest it has been since comparable records began in 1971.2 This means that approximately 15.6 million women in the UK were in employment in the last quarter of 2019.
On the other hand, technological and socio-demographic changes have contributed to the rise of self-employment, which also peaked at the end of 2019, passing the 5 million mark for the first time ever.3
These two trends didn’t develop in isolation from each other. In fact, the rise in self-employment since 2008 has been driven by a 69 per cent increase in the number of highly skilled female freelancers, choosing this way of work because of the freedom, flexibility and control it provides.
The number of freelance working mothers has also increased by 79 per cent since 2008. Freelancing allows mothers to pursue their career and spend time with their family in a way that simply was not possible half a century ago.
While the number of women in self-employment continues to rise, not a lot is known about the perceptions, attitudes and concerns of this group, as well as their experiences in self-employment.
What has research told us in the past?
Previous research on women in work has focused almost exclusively on employees.
For instance, a recent report by the Government Equalities Office found that the largest barriers to women’s progression in the workplace continue to arise from a conflict between current ways of organising work (including long-hours cultures and expectations of constant availability) and caring responsibilities.4
While the report puts forward a comprehensive list of recommendations for both government and organisations on how to mitigate some of these barriers, it does not mention self-employment, which allows more and more women to work flexible hours and successfully combine their work with their caring responsibilities.
Office for National Statistics (ONS) data on the gender pay gap in the UK also almost exclusively focuses on employee earnings.5 Even though there are a number of reasons why measuring self-employed income is hard, including accounting for irregularity of income and unpredictable finances,6 the lack of data can cause difficulties in understanding this sector of the economy and identifying solutions and recommendations for how to better support it.
There is some research that offers valuable insight into the experiences of women in self-employment.
The All Party Parliamentary Group (APPG) on Women and Work’s annual report touched on the importance of training and development for females in self-employment to build their career and expand their client base.7 The report, however, did not put forward solutions tailored to this labour group but rather provided a broader range of recommendations for all women in work.
In 2016, the Women’s Budget Group report on the rise of the self-employed found that while self-employment is a positive option for many, it might lead to a downward trend in their incomes because of limited access to training and social protection.8
While the report suggests a series of measures to support women who chose this way of work, it mostly relies on secondary data and does not explore the experiences and attitudes of self-employed women themselves.
What this report sets to uncover
The presence of women in the workforce has proved to be better for companies, societies and the economy as a whole.9 The increase in female employment since the 1960s has helped to boost living standards and the situation of women at work is very likely to continue to affect future living standards in the UK.10
Self-employment can allow women to tap into their entrepreneurial potential, which in turn can improve their wellbeing and economic situation, and also increase the value they add to the economy as a whole.11
That is why this report aims to uncover more about this ever-important segment of the workforce by drawing on data from a number of different sources, including a primary survey commissioned by IPSE and conducted by Savanta ComRes.
Firstly, the report will offer a snapshot of the demographic and occupational composition of the sector based on analysis of the Labour Force Survey (LFS) data.
The report will then focus on the key motivations, experiences and challenges of self-employed women. For this it will use an analysis of primary survey data based on the responses of 1,000 self-employed people who are representative of the UK’s solo self-employed population in terms of age, gender, occupation and region.
It will finish off with a list of recommendations for industry and policy, as well as self-employed women themselves on how they can make a success out of this way of working.
To reflect the true heterogeneity of self-employment, the report will refer to the following self-employed groups:
Solo self-employed women
In 2019, there were 4.6 million solo self-employed people in the UK, 1.7 million of whom were women.
The gender distribution of the UK’s solo self-employed workforce is uneven with almost two-thirds male (64%) and a third (36%) female.
While men dominate in most of the occupational categories, there are higher proportions of women in medium skilled occupations such as SOC4 (administrative and secretarial occupations – 79%) and SOC6 (caring, leisure and other service occupations, including hairdressing and housekeeping – 87%).

Women in freelancing
There is a more even gender distribution among freelancers working in the higher skilled occupational categories (SOC1-3), with 58 per cent male and 42 per cent female.
This is caused by the large increase in female freelancers since 2008.
The number of femalefreelancers increased by 69 per cent since 2008, while the number of men increased by just 43 per cent over the same period.


Working mothers
In the UK there are a total of 611,000 solo self-employed mothers, around half (302,000) of whom are working as freelancers.
The number of solo self-employed mothers has increased by 61 per cent since 2008.
This means that one in eight of all solo self-employed people are now working mothers.

Previous research about the motivations of women entering self-employment reveals a mixed picture, claiming that while it is a positive way of work for many, some were forced into it because of the uprating of the state pension age for women and public sector job losses.12
Reasons for entering self-employment



Only a fifth (21%) of women said that they entered self-employment because of lack of other employment opportunities and less than one in seven (13%) did so because they lost their previous job.
Interestingly, self-employed women were more likely than men to select reasons related to their wellbeing and personal circumstances such as greater flexibility and control of hours, work-life balance, as well as flexibility around childcare.

Happiness in self-employment
As suggested by their key reasons for entering self-employment, women reported high levels of satisfaction with their working life (7.6 on a 10-point scale), just slightly lower than the score for men (7.8 on the same scale).
Combined, these results suggest that self-employment contributes to better job satisfaction and improved wellbeing and it is a positive choice for most women, who take advantage of the freedom and the flexibility it provides.
Looking specifically at the highly skilled freelance sector, freelance women are also more likely to agree that self-employment gives them the flexibility they need around the rest of their lives (86% in comparison with 79% of men) and that being self-employed has become central to their identity (60% in comparison with 55% of men).13
Challenges and support needs
While it seems that freelance women enjoy the freedom and control that comes with self-employment, they are also more likely than men to experience concerns and challenges.
For instance, a higher proportion of freelance women agree that self-employment has been much more challenging than they expected (46% in comparison with 41% for men).
They were also more likely than men to be concerned about things such as irregularity of income, not being financially prepared for retirement, not having access to statutory employment benefits and not being able to get financial support.14
This is perhaps unsurprising with previous research revealing that women on average start their business with a third less capital than their male counterparts.15 Self-employed women (22%) are also less likely than men (33%) to have a private or personal pension.
In line with the above, a greater proportion of freelance women compared to men said they would like more support with areas such as pension planning/saving for later life, accessing financial support and training opportunities.
This is a concern given that access to business and financial support, as well as training and development opportunities, are often listed as key for women to break out of the low-pay cycle and progress in their self-employed careers.16
In addition, both men and women felt that they need more support in areas such as finding work, tax and legal issues, expanding their business and dealing with late and no payments.
Overall, looking at the attitudes and perceptions of freelance women, it seems that they tend to experience greater financial concerns in self-employment. This claim is examined in more detail later in the report.
Choosing self-employment as a way of work often means taking on more responsibilities, including finding work and securing a regular stream of clients.
While the rise in automation and technology has enabled freelancers to seek work in various ways, our research revealed that both self-employed men and women are most likely to find clients or market their services via the use of word of mouth, social media and referrals and testimonials.
Looking at differences between the two groups, almost twice as many women than men (50% compared to 29% men) refer to the use of social media for these purposes.
This could potentially be related to the fact that women in the sample tended to be younger and social media is where most Millennials and Generation Zs are looking for work, according to a study by the Aberdeen Group.17
Men on the other hand are more confident approaching clients directly for work (26% compared to 17% of women) and using online freelancing platforms (17% compared to 11% of women).
Challenges when looking for work
Self-employed women are slightly more likely to have trouble finding work with a higher proportion of them (75%) than men (68%) saying they find looking for work challenging. Finding work is also the administrative task self-employed people spend the most time on, as will be explored later in the report.
In terms of the key challenges experienced by the two groups, both self-employed men and women find not knowing how much to charge (35% of women and 23% men) and competition from other freelancers (27% of women and 24% of men) most challenging when looking for work. Interestingly, a larger proportion of women than men found these factors challenging.
Knowing how much to charge and setting your rates is essential in self-employment as it allows you to control your income over the year. However, there are many reasons why this could be particularly challenging.
For instance, when setting their rates freelancers should account for both maintaining their standard of living but also covering other financial commitments such as holiday and sick leave, pension provisions and business costs. On top of all that, the rates should reflect the value of their work to the client.
Therefore, the fact that over a third (35%) of women in self-employment find knowing how much to charge challenging provides one potential explanation for the persistent gender pay gap in the sector which will be explored later in the report.
Interestingly, a larger proportion of men (10%) than women (5%) stated that they had faced discrimination when looking for self-employed work, with men also being more likely than women to say they faced discrimination on the basis of nationality, race and ethnic background.


As with finding work, some differences can be observed between the experiences of women and men in their self-employed work environment.
Most prominently, remote working is becoming more popular among freelancers, with research showing that 87 per cent had worked remotely in the last year.
However, there is some variation in the preferred working locations between gender groups, with freelance women working from home more regularly and men being more likely to work from their client’s premises.18
This trend might relate to the rise in the number of freelance working mums, the number of whom increased by 79 per cent between 2008 and 2019. Freelancing allows mothers to pursue their career without stopping them spending time with their family.
Through freelancing, they can achieve a balance between their work and family life that simply was not possible half a century ago.
In fact, freelance women are more likely than men to say they enjoy the flexibility remote working allows around how they use their time (62% as opposed to 53% for men).
However, the research also revealed that remote working can sometimes result in loneliness and isolation which seems to be a greater concern for women, with a quarter (25%) of them saying they felt lonely as a result of working remotely in comparison with 16 per cent of men.
The research also found that a higher proportion of self-employed men than women use workhubs on a regular basis and that women are more likely to say they prefer to be working from home (58%) rather than go to a co-working space (49%).
Promoting workhubs among self-employed women could potentially help resolve issues of loneliness and isolation as they can increase co-operation among self-employed people and encourage the sharing of ideas and resources.19


The rising number of women in the labour market during the last decades points towards improved gender equality. However, research shows that the gender pay gap remains persistent in both employment and self-employment.
A recent ONS release shows that the gender pay gap among UK employees currently stands at 17 per cent, decreasing to nine per cent if the analysis is limited to those who work full-time.20
Previous research has claimed that the pay disparity within the self-employed sector is greater because of falling earnings but data on the issue is more difficult to find.21
OECD analysis from 2015 shows a 33 per cent gender pay gap in self-employment in the UK, marking an 11 per cent improvement from its level in 2004 (46%).22 However, self-employed income statistics are not broken down by hours, and the analysis doesn’t account for the fact that women in self-employment are more likely to work part-time than men.
While the ONS does not release a regular bulletin of the gender pay gap in self-employment, data from 2016 shows a 40 per cent gender pay disparity for the full-time self-employed and 32 per cent for those who are self-employed part-time, looking at their weekly earnings.23
Since both of these data sources are now out of date, we asked the self-employed themselves about the daily rates they charged in both 2017 and 2019.
While two-fifths of respondents (42%) chose not to reveal what their day rate was in 2019, the average reported day rate was £161, with substantial differences across gender groups.
Women say they typically charge £65 less per day than their male counterparts (£182 for men and £117 for women). The difference between the amount charged by men and women in 2017 was half this figure, with women charging £32 less than men (£219 for men and £187 for women).
In other words, while in 2017 men charged 16 per cent more a day than women on average, in 2019 this increased to 43 per cent.
While some of this difference can be attributed to the sampling methods, the research shows that there is indeed a persistent gender pay gap in self-employment which also disproportionately affects women working in low skilled occupations.
For instance, women working in the top three most highly skilled occupational categories SOC1-3 charge almost twice as much (£150 per day) in comparison with those who work in lower skilled occupational categories - £76 per day for SOC4-6 and £91 per day for SOC7-9.
Traditionally, the gender pay disparities have reflected undervaluing of women’s competences and skills on the side of the employer and offering lower pay for female candidates with similar skills, qualifications and experience to men.
However, the gender pay gap in self-employment could be caused by a variety of reasons linked not only to undervaluing women’s skills on the side of the client, but also to difficulty with setting day rates as mentioned earlier in the report.
Therefore, another layer of research on the topic is required to provide a better understanding of what are the causal factors behind the gender pay disparity in self-employment and how it can be addressed.
Financial worries and wellbeing
Looking at the gender pay gap in self-employment, it is perhaps unsurprising that self-employed women (49%) are more likely than men (37%) to say they experience worries over their financial circumstances always or most of the time.
IPSE’s previous research has shown that, when asked about different financial scenarios, self-employed women are more likely to feel insecure about their financial future in comparison to men.24
For instance, self-employed women are more likely to say that, because of their money situation, they will never have the things they want in life (65% in comparison with 50% for men) and that they are just ‘getting by’ financially (70% in comparison with 61% for men).
In addition, self-employed men are more likely than women to say they could handle a major unexpected expense (72% compared to 57% for women) and that they are secure in their financial future (63% compared to 54% for women).
In terms of the key barriers to managing their financial situation, self-employed women are more likely to select low income and volatility of earnings.
The research also finds that, overall, self-employed men are more likely to say that they are satisfied with their financial wellbeing (57% in comparison with 46% for women).
These findings suggest that self-employed women tend to worry more about their financial circumstances and this, therefore, could potentially have a greater impact on their mental health and wellbeing.
For instance, self-employed women were more likely to say that they have felt stressed or anxious (57% in comparison with 46% for men), depressed (33% in comparison with 24% for men), experienced feelings of inadequacy/failure (34% in comparison with 22% for men) and lacked confidence (38% in comparison with 29% of men) as a result of financial worries.
Experiences with financial products
A similar proportion of self-employed men and women succeeded in obtaining most of the financial products explored in the research including rental properties, personal loans, car finance and business bank accounts.
However, our research identified two types of financial products that women in self-employment often experience greater difficulties accessing – pension products and mortgages.

Mortgages
A substantially higher proportion of men (54%) who applied for a mortgage whilst self-employed than women (46%) succeeded in obtaining one.
Women (56%) were more likely than men (50%) to believe that mortgage advisers at banks and building societies do not understand their financial situation as a self-employed person.
Obtaining a mortgage whilst self-employed can sometimes be intimidating considering that lenders can require you to have a qualified accountant, provide at least one year’s worth of accounts, as well as a record of past work and evidence for future work.25
The lower success rate among women is especially concerning considering that more self-employed women (26%) than men (21%) are planning to apply for a mortgage in the next five years.
This could be associated with the fact that almost twice as many self-employed men (31% in comparison with 18% for women) already own their home outright.


Pensions
Similarly, self-employed women (76%) are substantially more concerned than men (63%) about saving for later life. This is perhaps associated with the fact that a higher proportion of them (37% compared to 26% for men) are currently not saving for their retirement in any way.
A significant proportion of the self-employed workforce is either approaching – or soon to be reaching – retirement age. Self-employed people aged over 60 are also the fastest growing self-employed age group, marking a 73 per cent increase since 2008. This raises questions about the importance of finding better pension solutions and saving strategies that will accommodate the large number of self-employed men and women who are about to enter retirement.
Another thing that is important to note is that the two gender groups differ on the basis of their preferred methods of saving for retirement.
While self-employed women are more likely to save in an ISA (31% to 25%), self-employed men are more likely to have a private or personal pension (33% compared to 22%), and they are twice as likely to invest in stocks and shares (17% to 9%), bonds (12% to 6%), trusts (9% to 4%) and cryptocurrencies (8% to 3%).
Saving habits of the self-employed

Business debt
Similar proportions of self-employed men (32%) and women (29%) have some form of business debt, with the most popular forms of debt being credit cards (17% of men and 15% of women) and business loans (14% of men and 16% of women).
Delays in payment
Previous research has shown that freelancers lose large amounts of time and money each year chasing late payments, the result sometimes being not getting paid at all.26
Late payment is an issue that seems to affect both self-employed men (61%) and women (58%) equally. Surprisingly, when asked about the longest time they had waited for a payment, men seem to wait much longer - 3.3 years on average in comparison with 2.4 years for women.
Self-employed men (52%) also seem to be disproportionately affected by non-payment by a client in comparison to women (45%). The most common reason for both groups is that the client never paid them for the work they completed (40%), rather than trying to gain exposure for their work or industry experience.

Time spent undertaking administrative tasks
Dealing with taxation, financial management and administrative tasks is something freelancers often feel they need more support with, especially for those who are new to self-employment.
As mentioned earlier, looking for work is the administrative task that self-employed individuals spend the most time on, out of the indicators measured. In the last twelve months, the average self-employed person spent 134 hours looking for work.
This compares to around 100 hours spent reporting, paying and reclaiming VAT (105 hours), fulfilling IR35 compliance obligations (102 hours) and chasing invoices for late payments from clients
(95 hours).
Across all measures tested, these were higher amongst men than women. For instance, whilst men spent over 150 hours looking for work (156 hours), women typically spent 97.
Likewise, reporting, paying and reclaiming VAT was 129 hours for men, compared to 68 hours for women. Whether men spend longer doing these tasks, or whether some of the differences can be attributed to perception, guidance built around streamlining these processes would particularly strike a chord with men in self-employment.
What the research has showed so far is that there is a persistent gender pay gap in self-employment and self-employed women experience greater difficulties than men accessing certain financial products such as pensions and mortgages.
Therefore, it is hardly surprising that self-employed women (46%) are more likely than men (39%) to not feel supported by the UK government in self-employment. In fact, only one in ten (11%) of them feel supported in comparison with one in five (20%) men.
The research also revealed that one of the areas where more government support is needed for both self-employed mothers and fathers is parental leave.

Parental leave
As mentioned earlier in this report, women often enter self-employment because of the greater flexibility and control of hours it allows, to improve their work-life balance, or because of flexibility around childcare – all features that could be particularly appealing to new mothers.
And indeed, a higher proportion of the men (50%) than women (40%) surveyed say that they were self-employed at the time of birth/adoption of their child(ren). We could understand from this difference that becoming a mother is more likely to trigger the move into self-employment than becoming a father.
However, previous IPSE research has revealed that existing parental leave policies do not reflect the needs of the self-employed, who are currently not eligible for Maternity or Paternity pay – or Shared Parental Leave (SPL).27
Self-employed mothers are only eligible for the Maternity Allowance which provides up to £148.68 or 90 per cent of the average weekly earnings (whichever is less) for 39 weeks. Self-employed fathers are not eligible for any paid parental leave.
SPL, which is only available to employees, was first introduced in April 2015, in order to give fathers more time to bond with their children, and to ease expectation on mothers. It allows up to 50 weeks of leave – 37 weeks of which is paid – to be shared by parents if they meet certain eligibility criteria.
Looking at the self-employed, three in ten men (30%) took less than 1 month of paternity leave and one in six (17%) took no time at all.
Among women, 42 per cent took 6 months or less of maternity leave and eight per cent took no time at all.
The figures reveal a relatively small group of self-employed parents who take advantage of the freedom and flexibility this way of work provides and take more parental leave than the average employee. However, perhaps concerningly, it also shows that there is a much larger group who don’t take enough time off to bond with their children.
Knowing this, it comes as no surprise to see that large proportions of both self-employed mothers (65%) and fathers (67%) believe Shared Parental Leave should be extended to the self-employed.
Maternity Allowance
While self-employed mothers are not entitled to Maternity pay, they are entitled to a Maternity Allowance and can work up to ten Keeping in Touch (KIT) days while they are on it to maintain their self-employed business. If they work more than ten days, the Department for Work and Pensions (DWP) decides how much Maternity Allowance they will lose and deducts that amount.
Our research revealed that only a third (33%) of mothers who had child(ren) while being self-employed claimed Maternity Allowance for the full period of 39 weeks it was available to them. Another third (31%) had to return to work earlier than that for career or financial reasons, while 30 per cent did not claim Maternity Allowance at all.
Interestingly, mothers aged 18-34 were more likely to claim Maternity Allowance for the full period of 39 weeks it was available to them (45%), while 43 per cent of 35-54 year-olds say they did not claim Maternity Allowance at all.
In terms of the number of KIT days taken by self-employed mothers, for many the 10 days were enough.
However, for some, the pressure appeared to be greater. In fact, one in four (25%) mothers felt that they needed more than the 10 KIT days currently allowed by the UK government.
Average time taken off by self-employed parents after the birth or adoption of their child(ren)

Experiences with claiming the Maternity Allowance in self-employment

Proportion of self-employed mothers and fathers who believe the Shared Parental Leave should be extended to the self-employed

Access to work-related training
Continuing training and development is important for the self-employed in order to keep abreast of technological, economic, legal and other issues in their respective occupational fields.
Unlike employees, self-employed people not only need to cover the cost of their training, but they also need to account for the money they will lose spending time on training and not working instead.
Labour Force Survey data shows that only 12 per cent of the UK’s solo self-employed have received job-related training in the last three months, compared to 26 per cent of employees.28
IPSE’s own research shows that a third (35%) of self-employed people undertook formal work-related training in the last 12 months, with women (41%) being more likely than men (32%) to have done so.29
The data also shows that the cost of training, both in terms of time and money, is one of the key barriers preventing the self-employed from engaging in it. Interestingly, a higher proportion of men than women select the time away from work and the inconvenience of formal training as key barriers, while women are more likely to select that they don’t feel they need training.
Career progression
For the self-employed, progression at work means something quite different from regular employees in the absence of a straightforward career ladder. Overall, IPSE’s previous research has shown that self-employed people seem to be satisfied with their career progression with an average satisfaction score of 6.9 on a 10-point scale.30 Self-employed men have slightly higher career satisfaction (7.1) in comparison to self-employed women (6.6).
Self-employed men and women also define career progression in a similar way, including measures such as increasing their skills and knowledge, as well as their turnover and feeling that their work has an impact.
Interestingly, self-employed men are more likely to choose being more selective with their projects and the clients they take on (51% in comparison with 41% for women) while women are more likely to select increasing their portfolio (50% in comparison with 41% for men) as a key measure.
Training needs of women in self-employment
Greater training and development opportunities can help bridge the gender pay gap in self-employment and lead women out of the low-pay cycle.
Previous IPSE research has shown that self-employed women are more likely to admit training would be useful to them in eight out of the nine areas examined in the survey.31
Differences were particularly significant in areas such as accounting and bookkeeping (women: 60%, men: 48%), the practicalities of setting up a self-employed business (women: 42%, men: 31%), taxes and self-assessment (women: 62%, men: 52%) and setting, maintaining and raising rates (women: 41%, men: 34%).
In the constantly evolving world of self-employment, training and business skills development can help self-employed women better face competition, boost their day rates and provide them with opportunities to find new clients.
That is why it is equally important for women to continue investing in their skillset and professional development in self-employment, as well as for industry and government to endorse this by providing flexible solutions meeting the needs of the self-employed.
Number of self-employed people undertaking formal work-related training in the last 12 months

Training needs in self-employment

Both self-employed men and women chose this way of work because of the freedom and flexibility it allows. However, women were more likely to select reasons related to their wellbeing and personal circumstances, while men were more likely to select work-related reasons.
While it seems that freelance women are more likely to enjoy the freedom and control that comes with self-employment, they are also more likely to experience concerns and challenges whilst working in this way.
Differences between men and women were especially significant when it came to areas such as irregularity of income, not being financially prepared for retirement, not having access to statutory employment benefits and not being able to get financial support.
Self-employed women are also more likely to experience difficulties finding work, mainly because of uncertainty around how much to charge, as well as competition from other freelancers.
A higher proportion of them also enjoy the flexibility of working from home, but for some, this results in loneliness and isolation. This, however, can be addressed by promoting the use of workhubs and co-working spaces.
The gender pay disparity in self-employment is currently at 43 per cent, with men charging on average £65 more than women per day. Women also tend to worry more over their financial circumstances and feel more insecure about their financial future.
A similar proportion of self-employed men and women succeed in obtaining most of the financial products listed in our survey including rental properties, personal loans, car finance and business bank accounts. However, women in self-employment often experience greater difficulties accessing pension products and mortgages.
Self-employed men, on the other hand, are more likely to spend longer completing different administrative tasks in self-employment.
Overall, women feel less supported by the UK government in self-employment, and both gender groups strongly believe that Shared Parental Leave should be extended to the self-employed.
This could potentially be related to the fact that only one in three self-employed mothers claimed Maternity Allowance for the full period of time it was available to them and a quarter feel they need more than 10 KIT days to maintain their self-employed business.
Women in self-employment are more likely to have undertaken work-related training and they are also more likely to admit training would be useful to them in areas ranging from setting up to taxes and bookkeeping.
Therefore, the research illustrates that while the two gender groups do face many of the same issues, women in self-employment have particular concerns, face particular challenges and need tailored support to meet their needs and help them to make a success out of self-employment.
To enable this, IPSE has put forward a set of recommendations for both industry and policy on what can be done to help women develop their potential in self-employment and live a comfortable and financially rewarding life whilst in it.