Why Self-Employment Is On The Rise

Newsflash: the economy is recovering. One of the key indicators of this is the fact that unemployment is falling. It is down to 6.9% in the three months before February 2014. However, whilst the Government and media are quick to push this statistic, there’s more to it. Since the economic crash, there has been a significant increase in the number of self-employed workers. The number of people who work for themselves is up by more than 600,000 since 2010. Industry experts are wondering if the increase is due to more ambition and drive, or something else?

According to PCG, the freelance union, a significant factor in the increase in the number of people who are self-employed is the reduction in start-up costs. A spokesperson for the Union said that peopSelf-employed helplinele are now able to start with less capital, or sometimes no capital at all. Previously, potential business owners were turning to banks for a £100,000 start up loan, now they can start with just £500. This is partly due to the technological changes in society. Starting a business used to mean you had to find a premises to base it in, materials, stock and employees whereas now, often a laptop, phone and internet connection can get your business off the ground. Industry insiders are saying that this notion makes self-employment a much more secure career path or a route out of unemployment when the job market is sparse.

However, it is important to note that the four most common self employment occupations: taxi drivers, joiners, farmers and other construction trades have not changed a lot, so it would be unrealistic to credit digital technology completely with the growth in self employment.

A large part of the rise could be down to part time self employment used by employers. Critics say that this is a way for companies to dodge expensive employee benefits by creating part time jobs. Another sector is those stuck between working and not working, such as new mothers who create a business from home in order to try and strike a balance by generating some income.

The main concern for self employed people is that they do not have access to pension schemes. 2013 figures show that self-employed workers have smaller pensions. Economically speaking, self employment creates lower earnings as people tend to work less. It also creates financial insecurity which impacts the level of disposable income being put back into the economy.

So perhaps beneath the surface, self-employed people are struggling more than we think.



What Does Flexitime Mean For Employers?

News shook the working world when it was announced that all employees in England will have the right to ask to work flexitime after 26 weeks of service to their employer. Previously, only parents and carers were given the right to ask.

It has been claimed that the new rights will make workers ‘happier’ and improve their productivity. Liberal Democrat business minister Jo Swinson said that the belief that workers need to be in the office in order to work was a ‘1950s mindset’. However, employment lawyers predicted a rise in the number of workplace disputes and rising resentment between colleagues who get flexible hours and those who are refused. The new right to flexitime is anticipated to lead to a shift in employment practice, specifically in companies where flexitime is not yet allowed. Requesting flexitime allows workers to ask for part-time hours, working from home, compressed hours or job sharing. In the past, the right to this request has been predominantly led by parents, which has in turn meant frustrated childless employees who do not get the saEmployers Helplineme treatment.

Miss Swinson said that workers can benefit from compressed hours, commuting outside of the rush hour or working from home, as can employers. She said that employers often find that workers who are given flexitime are more motivated and productive and thus, less likely to leave. She pointed out the technological advances which mean that employees no longer need to based in the office in order to get their work done.

However, employment lawyers believe that the new rights will lead to new complaints from those who miss out. Already, lawyers are dealing with cases where workers feel that they have to take on the work of their colleagues who have flexitime due to having children. With everyone now available to request it, the number of the complaints will rise.

A survey also found that 84% of employers expect the new right to be the cause of resentment among employees, with more than half believing that the changes will adversely affect the day-to-day running of businesses.

Experts have also warned that some workers may see the new rules as a right to have, rather than a right to ask. Under the current rules, three out of five requests are granted and a further one in four following negotiation with employers.

An employer can refuse a flexitime request for one or more of these reasons:Employers Helpline

  • The burden of additional costs.
  • Inability to re-organise work among staff.
  • Inability to recruit additional staff.
  • Impact on quality.
  • Impact on performance.
  • Impact on the ability to meet customer demand.
  • Insufficient work for the periods that the employee plans to work.
  • Planned structural changes to the business.

If you are an employer and you need advice on the new rights to flexitime, call the Employer Helpline.

Experts Reveal The Secret Of Doubling One’s Pension Pot

Experts have discovered a way for millions of workers approaching retirement age to increase their pension pot by almost 100%, it hasDeposit Into Piggy Bank Savings Account been reported.

Since the government’s new rules on state pension plans, many retirees have found they would be worse off if they chose to receive their state pension straight away, as opposed to deferring it.

It is expected that the state pension will increase by 10.4 percent over the next four years, plus an extra five percent for living costs. Therefore, experts have advised that if one can defer their pension for four years and live off their accumulated savings in the meantime, they will have a much bigger pension fund waiting for them by the end.

Alan Higham, retirement director at investment firm Fidelity, said:

[quote]”Many will be looking for a guaranteed income when they retire. If they spend money from their own pension instead of taking the state pension, and hold off for four years, the overall value from their savings pot will double.

“By doing this, the difference is always going to be double what you would expect if you had bought an annuity on day one.”[/quote]

Indeed, new rules in the Budget released recently no longer require workers to buy an annuity with their pension pot when they retire. The option to live off one’s own savings and defer taking their state pension is the new alternative for those trying to play it safe and save more money.

However, as the rules are set to change again in 2016, only those looking to retire in the next two years will be able to take advantage of this tactic. Financial experts have also warned that there are still risks with adapting this approach.

For one, the government could change the rules again, which could see the 10.4 percent rate decrease or even drop to zero. If another Government happened to be elected, it could also have its own plans for the pension.

Yvonne Goodwin of Yvonne Goodwin Wealth Management said that deferring one’s state pension is a good idea, but only if one is on top of their own finances. She also pointed out that spending one’s savings was not the only way to defer taking the state pension.

[quote]”It is a good idea to maybe get a part-time job and leave your pension, and your state pension, to grow. While your money is in a pension fund it is tax-free.”[/quote]

she said.

53% Of Carers Say They Are Not Receiving Enough Support

carersallowanceOver half of the people who are proving support to those living with disabilities say they are not receiving enough support. The figures come from a recent polls that shows how one in eight British people are now carers who having decided to look after a friend of family member who is ill or disabled. This comes to an estimated 6.5 million people.

Carers UK gathered the data to raise awareness of how many British people spend their time caring after someone else during Carers Week 2014. It also suggests that as the population ages, there will be around 9 million carers in just 20 years time.

Helena Herklots from Carers UK said:

[quote]As a country, we vastly underestimate just how much caring is done. We sometimes think we are an uncaring society. Well, 6.5 million people caring suggests otherwise. All of us at some point in our lives are either going to be caring for someone or need the help of a carer, so it is in all our interests to get better support in place and to really recognise the huge contribution that carers make to our society.[/quote]

However, despite the fact that a significant proportion of the population is now a care giver, many of the people Carers UK spoke to believe they are not receiving an acceptable amount of support. 53% believe there should be more being done.

Campaigners have singled out the government’s benefit Carer’s Allowance in particular. This is financial state support that provides £61.35 per week. However, they believe that the number is too low and not enough people are being made aware that it exists. Helena Herklots from Carers UK stated that “carers deserve a better deal” from the government.

Campaign groups have also called on local authorities, charities, businesses and the NHS to provide more help to those providing care. The current lack of support, according to Carers UK, is causing physical and emotion distress on those who are providing care to people with disabilities and illnesses. It has often been a cause of exhaustion, sleep deprivation and depression.

Helena Herklots from Carers UK continued:

[quote]Carers are struggling. More carers are finding they are not getting the support that they need. Over half the carers say they are not getting enough support. If they can’t cope, it means the person they are caring for might need additional help from a health service or social services. As well as being the right thing to do to support carers, it is also economically the right thing to do.[/quote]

London Councils Ask The Government To Retain Hardship Safety Nets

If you are struggling financially, help is supposed to come from local Councils and the Government. This is known as local welfare assistance or provision. Part of this is the budgeting loan. If you have been claiming income related benefits for at least 26 weeks, you can apply for a loan to help cover the cost of your rent, clothes, furniture, hire purchase debts and more. In London, this can sometimes be provided in physical form to residents in urgent need who are going through the transition of unemployment to employment. The total sum which is allocated to London as part of this scheme is £27 million and it has been revealed today that the Government is planning to cancel it.Budgeting Loan

Until 2013, the needs of desolate citizens were looked after by the provision of crisis loans and grants as well as budgeting loans. However, this money is to disappear completely after initially being reduced, although the demand for the services is increasing. The proposed end for the funding was put into the national local Government finance settlement for 2015/16.

However, London Council is fighting back by compiling a report detailing exactly how the funding helps people. The report lists a number of imaginative schemes across the boroughs where projects have been put in place in partnership with Credit Unions to help benefits claimants to prepare for the arrival of Universal Credit, as well as help and advice on budgeting for people struggling to find work or on a low income wage. Before this scheme, over 8000 benefits claimants in London did not have bank accounts, however this number has diminished since the projects began.