The quarterly Freelance Confidence Index is a fair measure of the UK self-employed’s perception of the state of the economy. Moreover, their place within it.
IPSE has just updated that index with Q2 2015 survey results. The mood is good, but there are negatives.
Despite the budget turning the screw on self-employment in general, business confidence is the highest recorded in the Index to date. Confidence in the economy is also moving in the right direction.
However, we must note that IPSE changed the way it reports on the sector this quarter. This is the third update in a row that’s taken on board the views beyond the membership.
Since Q4 2014, the report has included feedback from digital freelance agencies, too. The ‘positive note’ for this update is that the survey pool increased to 710 independent professionals, more than double the amount in some previous updates.
We also have to bear in mind the timing of the poll, between the 15th-30th June. Chancellor Osborne was a week away from delivering his body blow combo in the Emergency Budget, a point noted in IPSE’s summary.
Points of Note from Q2 Survey
In Q1 this year, freelancers’ business confidence was a positive 8.9. That increased to 11.8 in Q2. Confidence in the economy also rose, jumping to 16.1 this quarter from 12.1 last.
On the down side – and perhaps the beginning of a slippery slope – is the freelancers’ perception of business costs. Almost half (46%) forecast the cost of running their business to increase over the next twelve months. That was before Chancellor Osborne announced the tax-free cap of dividends at £5,000 a year in the budget.
If those polled are operating through their own limited (personal service) company, expect to see many more join the 46% forecasting a rise in the next update.
Another interesting factor is the 2.5% drop off of freelancers working on contracts at the time of the poll. In Q1, 82% of respondees had assignments on the go. In Q2, that dropped to 80%.
This drop-off is in line with recent self-employed figures, which show 131,000 self-employed people disappear from the labour market.