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Release: UK financial services industry must not fail the self-employed

10-Nov-2014

Analysis by Kensington reveals that if the current trend for self-employment continues, around 4.6 million people will be self-employed by 2054, making up almost a third of the UK’s workforce (30%).

According to new research1 from Kensington, the industries with the highest proportion of people who have ever been self-employed for at least 12 months are Retail & Sales along with IT & Information Services, which respectively account for 15% and 11% (see figure 1). Analysis by the specialist lender reveals that if the current trend for self-employment continues, around 4.6 million people will be self-employed by 2054, making up almost a third of the UK’s workforce (30%)2. However, it believes that the UK financial services industry must do more to adapt to the particular requirements of self-employed people when it comes to financial products, pensions, tax, employee benefits and understanding the challenges posed by fluctuating income.

Kensington reveals that men (aged 65 plus) from London or the South-East of England working in ‘retail and sales’ are the most likely to have ever been self-employed. At the other end of the scale, those least likely to have ever been self-employed are women (18-24years) from Northern Ireland working in ‘science and pharmaceuticals’.

 

Figure 1. Top ten sectors/industry with self-employed workers over the last 12 months:

Source: Kensington Mortgages, September 2014

Figure 1.

Top ten sector/industry with the highest proportion of those who have ever been self-employed for at least 12 months

Proportion

Retail and sales

15%

IT and information services

11%

Property and construction

8%

Hospitality, leisure, tourism and sport

6%

Creative arts and culture

6%

Teaching and education

5%

Engineering and manufacturing

5%

Health and social care

5%

Transport and logistics

4%

Business consulting/management (exc. Marketing)

4%


Whilst the sectors are likely to remain similar, Kensington believes that the top ten most common jobs for self-employed workers will change dramatically over the next 40 years and are likely to bear little resemblance to those currently popular with self-employed people.

The latest figures from the Office for National Statistics (‘ONS’)3 reveals that skilled trades such as taxi driving, construction and carpentry were the three most popular jobs in 2014 but that the biggest rise was for professional, scientific and technical activities and includes roles as management consultancy, book-keepers, photographers and chartered accountants.

Keith Street, Head of Kensington, says:

“Self-employed people account for the fastest growing part of the UK workforce but are still poorly served by the financial services industry.

“We have the underwriting expertise to make individual lending decisions for people whose circumstances are not easily assessed by a tick-box automated approach. Our message is clear – if you are self-employed, your mortgage options are not limited to the high street. Speak to an independent adviser to find the most appropriate mortgage for your circumstances.”



1. Kensington Mortgages commissioned Research Plus to conduct an online survey of 2,073 UK adults between 11th – 15th September 2014

2. Based on predictions using ONS “Self-employed workers in the UK” (August 2014)

3. ONS – “Labour Force Survey” (August 20, 2014)

 

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