Self-employed could mask true unemployment, warns TUC

The recent increase in the number of people in work has been driven by a surge in self-employment, which could be masking the true level of unemployment, according to a new report.

The TUC said there had been a 9% rise in self-employed people since the start of the recession in 2008, compared with a 1% fall in the total number of employees.

The biggest increases in self-employment were in administrative and secretarial work, sales and customer services and occupations such as hairdressing and cleaning, according to the study.

Frances O'Grady, general secretary of the TUC said: "We know that the harsh economic climate is having a huge effect on the amount of work that those fortunate enough to have a job are able to get, with over three million people saying they would like more hours than they currently have.

"Ministers brush away these concerns by saying that there are more people in work than ever before. What's not clear though is how many of these new jobs actually offer secure and regular paid work, let alone enough hours to make ends meet."

O'Grady said it would be naive to think that those who were now self-employed were "all budding entrepreneurs."

"Worryingly, the figures suggest that many of those who have lost their jobs over the last few years are not simply choosing to go freelance, but are being forced into false self-employment, which is often insecure and poorly paid."

A separate report by finance firm Legal & General said that job confidence across the UK had fallen in recent months, with fewer than three out of four people saying their job was secure.

A survey of over 2,500 adults showed that just over half believed they will have worries about how to maintain their standard of living.

Meanwhile, the Federation of Master Builders warned that a third of small to medium sized building firms feared they will have to cut staffing levels this year because of the decline in the construction industry.