The headline employment data today looks good. 239,000 new jobs.
However, self-employment accounted for 146,000 of the increase. But as I have shown, firstly no one really knows how many self employed people there are and secondly, they earned an average of £10,400 each in 2011-12, on a steadily falling trend. These people will be living below the breadline.
So will those in new part-time work, where the figure rose by 74,000.
There were, therefore, just 19,000 new full time jobs. I bet most of those were minimum wage and zero hours contracts.
The exploitation of the UK goes on.
This is no cause for celebration.
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Actually the ONS data for 2011-2 shows 4.835m self-employed with and average income of £16,587
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/276310/table3-9-12.pdf
It is worth pointing out that some classed as self-employed are scraping less than a living to top-up their redundancy pay but it would be better if you got the numbers right.
That issue is considered in my report – why not read it?
The ONS and HMRC data starkly contrast with each other and I have noted the fact
I have now done so.
Your figures are seriously misleading and your analysis consequently flawed. To include casual earnings of those in full-time employment, or part-time earnings from those in part-time employment and self-employed part of the time as if they were the individual’s total income is, with all due respect, wrong. Those with trivial earnings from part-time self-employment (such as academics paid fees for appearing on TV as experts or writing articles) and unstated earnings from employment are rarely on the breadline. You exclude from your so-called average all those earning over £100,000 but include the 10% with zero earnings: very few of the latter are genuinely seeking to earn a living full-time from self-employment.
When you say “The conclusion is inescapable: the self-employed are, despite their growing numbers becoming worse-off.” I agree with you: I am confident that this would be shown to be the case if you used a like-for-like comparison, excluding those who have taken up self-employment since 2008. It would still be shown if you used a valid analysis.
I can assure from my personal experience that it is possible to have taxable self-employed earnings without being full-time self-employed (one year it was £75, which was taxable because I had significant income from employment) so the number with taxable self-employed income is greater than the number of full-time self-employed. I should expect the vast majority of those with both employment and self-employment income to be liable for tax and almost all those who have both a pension and self-employment income from part-time work to keep them out of their wives’ hair.
You might like to note that the fall in income is not simply down to a fall in productivity but is exacerbated, in many cases, by a reduction in fee rates for equivalent work. A reduction in work available to be done leads to a fall in productivity but the consequent fall in fee rates means the fall in income per head is much greater than the fall in output.
Respectfully, that is your interpretation
But excluding outliers is always permissible
And the data has been consistently interpreted
The result is more valid than HMT claim that a part time self employment is a job, by a long way
I should have thought that I made it clear that I do not regard casual self-employment on top of a full-time job as being a job. Part-time self-employment is probably half a job, which when combined with part-time employment makes roughly one whole job (usually not a good one, but occasionally it is). The occasional piece of consultancy work for a pensioner who would otherwise be bored is not a job.
I wasn’t arguing about that (although your assumption that every single new registration as self-employed should be considered as disguised unemployment is a bit OTT – an estimate of real new self-employed jobs would be better). I was just saying that you could use accurate data to argue your case.
Since you are not a statistician you may be forgiven for thinking “excluding outliers is always permissible” – it is permissible in certain circumstances in looking at sample values but not when looking at whole populations and not when it is limited to one end of the distribution, thereby introducing a bias. The better method if you, rightly, think that the handful of very highly paid self-employed (or “self-employed” BBC “stars” who
distorted the 2011-2 data) distort the picture is to use the median income instead of the mean. This can be estimated from the tables that you use to calculate the mean (albeit fairly crudely, but elementary statistical techniques will allow you to draw a decent graph) and is both a more robust statistic and is better at representing the impact on the typical self-employed worker. It’s too late at night to work it out but I could look at it in the morning if you would like me to do so.
The government figures that, accorfing to ITV news, show that pay has out stipped inflation proves the old adage that there are lies, damned lies and statistics.
Inflation has fallen to under 1% has it? That is where most public sector wage rises are held at, as is much of the private sector.
So pray tell. how is pay outstripping inflation?
Whom do we believe? Is it “Minitrue”, “Miniplenty” or neither.
Will the stats be “adjusted” later?
These figures are no cause for celebration – we know that the vast majority of the jobs created are low skilled and low paid,
As for the ridiculous manner in which inflation is calculated…this bears little relationship to the impact that the price increases in essentials have on all ordinary people, due to the failure of their wages to arise accordingly.
Food bank usage is not increasing..
“War is Peace”, “Freedom is Slavery”….
Today, an ex-soldier called at my door with a holdall full of tea towels and dusters for sale. His embarrassment at his situation was heart-rending… This is a degrading return to the pre-war years of hawkers, tinkers and pedlars… and I doubt that he’ll achieve £10.4k from selling tea-towels.
Which is exactly what this government want, a return to the degrading conditions of the inter war years, when the ‘returning heroes’ from WW1 and decent ordinary people were left to rot when economic depression, courtesy of the banking elite, arrived. The anger at this social injustice gave us the 1945 Labour government, who managed to set up, despite the economic damage caused by the war, a social security system to prevent people falling into degrading economic circumstances.
But now, thanks to this government, using the excuse of ‘austerity’, this is all being dismantled. And the Tories are able to do this not because they have the support of most of the population , but because the Lib Dems, throwing away any principles they ever had, have joined them in government.
I don’t know what the outcome of the next general election will be, but I do know that the Lib Dems will be annihilated as a party; good riddance too as far as I’m concerned.
Nicely summarised…
And as Bill Bailey said recently
“The only thing left of the Lib-Dems after the next election wild be a bunch of flowers tied to a railing somewhere”
People selling household goods door-to-door isn’t new, and isn’t something that disappeared after the postwar recovery only to return in these austere times. It’s been going on all along, and seems to be often used as a ‘get back on your feet’ type ‘opportunity’. That would explain why you were visted by an ex-soldier (many have hard times adjusting to post-military life) and I, over the years, have been visited by people with physical or mental disabilities, ex-offenders, or other similar groups.
Personally, I think sending out particularly vulnerable people to do that kind of work is shocking. They are being exploited (often by supposedly charitable organisations) in the hope that the sympathy vote will get people to buy. Just don’t kid yourself that it ever went away.
I recall that in a recent Panorama report on the bedroom tax a claimant was sanctioned because she refused to take a commission only job selling cosmetics door to door. What a grotesque and twisted system we live in that an employer can be compelled to pay minimum wage, unless they decide instead to pay nothing.
Why does no-one in the media ever challenge these figures by asking, for instance, whether this is a rise in mean, median or modal average wages? (rhetorical question of course).
What’s more, The figures are an average of ‘pay including bonuses’, rendering the figures absolutely meaningless (just one city banker receiving an extra million pound bonus, by my calculations, would add 3p onto the average wage for 30,000,000 workers. Make that £5bn across the Capital that equates to a mean average increase of £166 per worker, per year, or a .01% increase on the annual remuneration of a worker on minimum wage. £5bn, by the way, is approximately equivalent to the bonus pool of just two of our major banks (Barclays and HSBC). All the Government’s average tells us is that someone, somewhere, is getting richer.
And how can an inflation figure that excludes house prices be regarded as having any meaning at all. The Coalition are presiding over the biggest housing crisis since certain German tourists carried out an ad hoc slum clearance in 1940. Peoples reality is governed by three things, work, food, and housing. It is a patent nonsense to dismiss housing costs from the equation, as though it were somehow incidental.
The figures provided are so obviously spurious as to be unworthy of discussion. More important is the collusion of the media in the social construction of reality, and the echoing void of ‘the Opposition’.
I agree that growing self employment conceals low incomes i.e. “under employment”.
And that Full time jobs conceal low wages. But the concept of a single “Full time ”
employment is somewhat out of date. Portfolio working is becoming more prevalent
– and probably more secure than one full time employment where one has all one’s eggs
in one basket. There are other trends too, e.g. in Sweden where they are finding that public workers are more efficient working fewer hours. And it is better to have lowish wages than subsistence wages or no wages at all-ask workers in Africa and Asia. Maybe the UK is being exploited,but it’s relative, I suspect many people in the world would love to live here.
Are you attempting to justify the ‘race to the bottom’? You seem to be ignoring the fact that the Government makes up the difference through working tax credits, housing benefits and the rest?
I think you will find that the reduction in the hours of PSW’s in Sweden has not (as here) been with a crushing reduction in living standards.
And by ‘portfolio working’ do you mean cleaning toilets for two different employers for minimum wage instead of one?
Martin
I have to say I did share your suspicions
Richard
Do the figures take dividends into account or just the taxable wage taken by the owner which is declared to HMRC ?
A lot of self employed people declare around the £10,000 mark the take dividends.
Also, do the figures take into account expenses claimed, phone bills, petrol, renting yourself a room in your own house ? Plus VAT can be claimed back on many expenses.
You will never meet a market trader ‘earning’ more than £10,000 whatever flash car they drive.
These figures are for the self employed – not owner director companies who are employees according to both ONS and HMRC
The figures are after expenses
Pretty sure the latest labour market statistics show that full time employees increased by 45,000 not 19,000?
I based the comment on what I think were reliable reports
It is always safer to use the original data rather than second-hand reports
http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-304635#tab-Employment-tables
19k is actually the difference between the increase in the total number working *part-time* and the number of *part-time* employees so as far differentiated as possible from the change in full-time employees.
Perhaps it might be more salient to agree to differ… Perhaps ‘of the new jobs created between 82-93% were not actually full time’ sounds better?
Fair point
The data on the self employed will, in any case, always be very approximate
No, NO to Martin Snell.
69% of the jobs were classified as “full-time”
19% were “full-time employed”, 46% “full-time self-employed”
The other 4% was made up of people whose part-time employment and part-time self-employment made up a full-time job
‘Of the new jobs created 31-35% were not actually full-time’ might or might not sound better but would have to advantage of being correct.
It seems you now agree my blog was right
john77, having recently investigated the possibility of becoming self-employed I can assure you that the Job Service definition of ‘full-time self employed’ differs from what most of us might consider as full time employment, relying heavily, as it does, on working tax credits and a £40 per week supplementary payment for the first twelve months. Seriously, are you noticing thousands of new businesses springing up everywhere? Legions of newly qualified plumbers and decorators knocking on your door?
For thousands of people in Britain the safety nets of working family tax credit makes notional ‘self employment’ a superior alternative to under-employment, unemployment or zero hours contracts.
Dress it up however pleases you…