2 May 2023 – Traditional employment is no longer seen as the safest option when it comes to job security. This has led many to reassess their career plans and look for alternatives.
UK businesses had a tough few years, with a pandemic followed by a labour shortage and rising costs. And the challenging times are not yet over.
Inflation is still high, and energy costs have also risen last month, increasing financial pressures for firms. As a result, many were forced to reduce their spending, which led to a high number of proposed redundancies this year already.
New research now suggests that the resulting volatile job market has had an impact on workers’ attitudes towards salaried work and their career plans.
Over Half Of Employees Are Looking For Alternatives To Traditional Employment
Being in full-time permanent employment with a guaranteed monthly salary has long been seen as the most secure way to gain financial stability. But the recent economic turbulences seem to have changed this view for many.
The survey, conducted by the freelance platform Fiverr, asked 500 UK office workers whose jobs were cut since the end of last year, about their attitudes towards employment.
According to the findings, 57% of people who have been made redundant since December last year are looking into alternatives to traditional employment. With 47% of respondents saying they have lost faith in salaried work, it is no wonder they are looking for alternatives to future-proof their careers.
This lack of trust in full-time employment has led to 35% of respondents planning to run a side hustle even when in a full-time role.
Over a third of the survey participants plan to become a sole trader, as they see self-employment as more secure than employment. Freelancing and self-employment is not only seen as a way of gaining more control over one’s own career, but also to gain a better life/work balance.
[…] laid off workers are seeking out new opportunities to find careers where they can find more meaning in their work and, through freelancing and self-employment, have the flexibility to make their roles work better around their own schedules and passions.Bukki Adedapo, UK Country Manager at Fiverr
This move away from employment and into self-employment is also evidenced by the number of company incorporations. According to Companies House, 222,068 new companies have been set up between January and March this year.
This is an increase of 8.2% compared to the same period last year, when 201,073 incorporations were recorded. This is a clear sign that more people are deciding to set up their own business and become their own boss.
However, the number of company dissolutions has increased by 8.6% in the first quarter of 2023, compared to the previous year.
This is probably due to financial pressures increasing, with inflation still high and energy prices having risen in April.
The number of businesses in the process of closing between January and March 2023 is 24.2% higher than in the same period in 2022. A clear indicator of how much UK businesses are struggling with the current economic situation.
This makes the findings of Fiverr’s research even more interesting. With job stability the main concern for most people (70%), their view of the job market appears very bleak, if self-employment seems a safer bet.
Finacial Pressures On Companies Given As Main Reason
The study also asked in their survey why the workers thought they were made redundant. With 41%, the main reason given was that the firm struggled financially. But 30% thought that their company had over-hired.
Especially workers in smaller businesses (10–49 employees), speculated that this was the reason, with 39% answering in that way. For bigger companies (over 500 employees), 36% gave this reason.
30% put the decision to lay them off down to their personal performance. Graduates and entry level workers were more likely to report this reason, with 41%.
Optimistic Outlook On Future
Even though the UK economy is in trouble and people are feeling the financial pressure, the respondents to the survey have an optimistic outlook on their future.
And not everyone sees being laid off as a negative. According to the study, 72% of workers felt “relieved”, because it gave them the opportunity to look for a new start. 66% reported that they didn’t find their work meaningful.
This has led 71% of respondents to seek a fresh start with plans to switch industries. This wish for change is the strongest in the technology sector, where 67% said they wanted a new career.
Given the recent lay-offs in the tech industry, these figures are probably not surprising. Big corporations such as Meta, Amazon and Twitter have reduced their workforce in recent months to mitigate profit losses.
What impact this change in attitude towards traditional employment will have on the UK economy remains to be seen. But it appears that for now, some workers put their trust in their own skills and efforts rather than an employer.