New research from the Association of Independent Professionals and the Self-Employed (IPSE) has revealed that freelancer confidence rose in the first quarter of 2022, despite soaring inflation and the ongoing cost of living crisis.
The confidence of freelancers in their own business rose from –11.0 in the fourth quarter of 2021 to 2.2 in Q1 2022, the first return to positive figures since Q2 2021. Freelancers polled for the quarterly IPSE Confidence Index, which surveys members of the IPSE and PeoplePerHour, also found that freelancers are more positive about increasing their pay.
In Q4 2021, freelancers anticipated that their day rates would rise by just 3.6 per cent over the next 12 months. In the latest quarter, however, freelancers expect an average increase of 13.5 per cent over the coming year. Job related stress has fallen to its lowest level since Q3 2019 (5.84 on IPSE’s ten-point scale on which zero means no stress), while job satisfaction rose to 5.81 (another ten-point scale on which zero means not satisfied at all and 10 means extremely satisfied.)
Despite these positive developments, freelancer confidence in the wider economy has remained low, with only a slight increase from -23.7 in Q4 2021 to –23.1 in the latest report. 64.7 per cent of freelancers named the state of the UK economy as the most detrimental factor on their business. 62.1 per cent cited government tax policy as an issue, while 59.2 per cent said their business was impacted by regulations around the hiring of freelancers.
Finally, the report also found that 86 per cent of self-employed workers expect their input costs to rise over the next year, compared to 81 per cent in Q4 of last year. 39 per cent of freelancers are incurring business debt (compared to 38 per cent in Q4 2021), while 16 per cent are incurring debts on credit cards issued under their business name.
IPSE CEO Derek Cribb said: “After a mixture of pandemic uncertainty and post COVID-19 inflation, life for freelancers is finally starting to look up. Work is returning, confidence in their own business is growing, and stress is falling rapidly. In other words, the dynamism and energy of the self-employed sector is finally beginning to rear its head once more.”
“However, freelancer confidence should not be taken for granted. The cost-of-living crisis is still wrecking the UK economy and the government needs to ensure that self-employed workers aren’t pulled back into the abyss.”
