IPSE (the Association of Independent Professionals and the Self-Employed) has warned that a “disproportionate and disturbing” drop in the number of self-employed will lead to a “brittle workforce” just when, going into a recession, it needs to be at its most agile.

The comments came after the ONS survey revealed the number of self-employed fell by a record 238,000 in the second quarter of 2020.

IPSE has said the drop in self-employment is “almost certainly” because of gaps in self-employed support during the coronavirus crisis compared to the more comprehensive employee support. It also reported in its most recent Confidence Index that self-employed quarterly incomes have dropped by 25 per cent after a record fall in the amount of work they are able to secure.

Derek Cribb, CEO of IPSE (the Association of Independent Professionals and the Self-Employed), said:

“In the second quarter of 2020, there was a disproportionate and disturbing slump in the number of self-employed in the UK – far more than among employees. This is almost certainly because of the serious gaps in the government support for the self-employed, including directors of limited companies and also the newly self-employed, who are at the most fragile stage of their careers.

“Going into a recession, we would normally expect a jump not a slump in the number of self-employed, as businesses look to the flexible expertise they offer. However, with government policy driving down the number of self-employed, there is a real fear the UK workforce will become brittle and rigid just when it needs to be at its most agile.”