Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • July 2017
07

Self-employed fast becoming 'financial underclass'

Open-access content Friday 4th August 2017 — updated 5.50pm, Wednesday 29th April 2020

The average self-employed person in the UK is falling far behind their full-time counterparts in terms of earnings, pensions, and insurance provision.

2

Research by financial services firm Drewberry, shows that 73% of self-employed Britons do not have a personal pension, while half of those that do, are not sure how much they have in their pot.

It was also found that these workers are twice as likely as full-time staff to have £200 or less of discretionary income a month, while just a quarter have life insurance, compared with 39% of other employees.

"This highlights the pressures that are being exerted by the on-going 'Uberisation' we're seeing in the UK's employment market," Drewberry director, Tom Conner, said.

"Last year we identified that the growth of the 'gig economy' meant that Britain's self-employed were fast becoming a 'financial underclass'. This year's results show that nothing has arrested the decline."

It was also found that two-thirds of the approximately 3.7 million self-employed Britons without pension provision, do not have one as they say they cannot afford it.

Among those that know how much they contribute to their pension, 91% put in 10% or less of their take home pay, while 34% didn't start contributing until they were at least 36, compared to 11% of full-time staff.

"Extending auto-enrolment to this group looks like a real 'life-line'. However, it could be a decade or more before average contributions reach worthwhile levels," Conner continued.

"In the meantime, the self-employed will be left to fend for themselves when it comes to pensions, and this hasn't worked out well so far."

The research also shows that only 5% of self-employed workers have critical illness cover, and just over 1% has income protection, despite 46% having less than £1000 in cash savings to fall back on, and no sick pay.

In addition, it was found that over 19% of today's self-employed are in what were once considered their 'retirement years' and so might struggle to find affordable cover.

"Even if you allow for those in this age bracket, it still means that in today's Britain there are over four million self-employed people whose entire livelihood is at risk if their health lets them down in the coming years," Conner added.


Sign up to our free newsletter here and receive a weekly roundup of news concerning the actuarial profession

This article appeared in our July 2017 issue of The Actuary .
Click here to view this issue

You may also be interested in...

2

Ageing society and migration limits present 'workforce crisis'

The number of workers aged over 50 in the UK economy grew by 230,000 between the first quarter of 2016 and the first three months of this year.
Thursday 3rd August 2017
Open-access content
2

Bank of England downgrades growth expectations

The Bank of England (BoE) has downgraded its forecast for UK economic growth for 2017 from 1.9% to 1.7%, following a disappointing first half to the year.
Thursday 3rd August 2017
Open-access content
2

Hiring across UK service sector hits 18-month high

Recruitment in the UK’s service sector last month increased at the fasted pace recorded since January 2016, according to the latest IHS Markit/CIPS UK Services PMI survey.
Thursday 3rd August 2017
Open-access content
2

State pension age hike leaves women £32 a week worse off

Approximately 1.1 million women in their early 60s are £32 worse off each week as a result of increases to the state pension age at the start of the decade.
Wednesday 2nd August 2017
Open-access content
2

Fossil fuel subsidies result in health costs six times as high

The global health costs associated with fossil fuels are over six times greater than the amount governments pay subsidising carbon-intensive energy sources.
Tuesday 1st August 2017
Open-access content
2

Hundreds of thousands plan to pay off mortgage with pension money

Approximately 320,000 UK homeowners aged 51-65 are planning to pay-off home loans using money from their pension, according to research from Just.
Tuesday 1st August 2017
Open-access content

Latest from July 2017

2

UK FinTech investment booms

Total FinTech investment in the UK reached $1.4bn (£1.07bn) in the second quarter of 2017, according to new research by KPMG.
Friday 4th August 2017
Open-access content
2

Almost one third of cyber breaches caused by employee error this year

Accidental cyber breaches caused by employee error or third party suppliers accounted for almost a third of the total breaches recorded in the first six months of 2017.
Wednesday 2nd August 2017
Open-access content
2

Electric cars almost 50% more expensive to insure

UK drivers opting for electric cars are paying an average of 45% more to insure their vehicle than other motorists, according to research by comparethemarket.com.
Friday 28th July 2017
Open-access content

Latest from small_opening_image

2

COVID-19 forum for actuaries launched

A forum for actuaries has been launched to help the profession come together and learn how best to respond to the deadly coronavirus sweeping the world.
Wednesday 25th March 2020
Open-access content
2

Travel insurers expect record payouts this year

UK travel insurers expect to pay a record £275m to customers this year as coronavirus grounds flights across the world, the Association of British Insurers (ABI) has revealed.
Wednesday 25th March 2020
Open-access content
2

Grim economic forecasts made as countries lockdown

A sharp recession is imminent in the vast majority of developed and emerging economies as the deadly coronavirus forces businesses to shut down across the world.
Tuesday 24th March 2020
Open-access content

Latest from inline_local_link

2

COVID-19 forum for actuaries launched

A forum for actuaries has been launched to help the profession come together and learn how best to respond to the deadly coronavirus sweeping the world.
Wednesday 25th March 2020
Open-access content
2

Travel insurers expect record payouts this year

UK travel insurers expect to pay a record £275m to customers this year as coronavirus grounds flights across the world, the Association of British Insurers (ABI) has revealed.
Wednesday 25th March 2020
Open-access content
2

Grim economic forecasts made as countries lockdown

A sharp recession is imminent in the vast majority of developed and emerging economies as the deadly coronavirus forces businesses to shut down across the world.
Tuesday 24th March 2020
Open-access content

Latest from 07

2

UK FinTech investment booms

Total FinTech investment in the UK reached $1.4bn (£1.07bn) in the second quarter of 2017, according to new research by KPMG.
Friday 4th August 2017
Open-access content
2

Almost one third of cyber breaches caused by employee error this year

Accidental cyber breaches caused by employee error or third party suppliers accounted for almost a third of the total breaches recorded in the first six months of 2017.
Wednesday 2nd August 2017
Open-access content
2

Electric cars almost 50% more expensive to insure

UK drivers opting for electric cars are paying an average of 45% more to insure their vehicle than other motorists, according to research by comparethemarket.com.
Friday 28th July 2017
Open-access content
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Investment Consultant

Scotland / Scotland, Edinburgh / London, England
Up to £70000.00 per annum
Reference
148689

Market Risk Capital Actuary/Quant

London (Central)
£65,000 - £115,000 plus bonus and package
Reference
148688

Experience Analysis Contractor

England
Negotiable
Reference
148687
See all jobs »
 
 
 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ