Randstad has published its flexibility@work 2015 report, including a recent study by prof David G Blanchflower of Dartmouth College on self-employment in the Great Recession of 2008-2014. In most countries self-employment has been decreasing or stable during the Great Recession, where only in the Netherlands, UK and France there was a clear growth of (high-skilled) self-employment. The study on self-employment shows that a higher self-employment rate was not conducive to grow out of the Great Recession.
Pull or push
The study also reveals that the self-employed are either pulled or pushed into working for themselves. During economic growth ‘pull’ factors tend to become more important; demand is booming and workers feel confident to set up his or her own business. Frequently, these pull self-employed are job-makers and their number is more likely to increase when unemployment is low. Push self-employment is more likely to occur due to lack of alternatives when unemployment is high.
Adapting to the Great Recession
With the Great Recession hitting self-employed earnings especially hard, it comes as no surprise that self-employment earnings were down more than 20% since the onset of recession. Yet self-employed are more satisfied with their jobs than employees and adapted to the impact of the recession by increasing their hours or blending self-employment with a wage-job. The self-employed don't have an employee benefits package, which in many countries means they have to provide their own health insurance and retirement plan.
Need for mature system of social protection
“The report shows a healthy labor market needs different types of flexible employment to thrive. In order for businesses and economies to remain innovative and competitive in today’s environment, flexibility will be imperative”, says Jacques van de Broek, CEO Randstad Holding nv. “Governments should be encouraged to create a mature system of social protection that stimulates a modern, accessible, well-regulated market. Not only for the self-employed but also for other flexible labor arrangements that provide essential transitions into the labor market, such as temporary employment and agency work.”
Posted: Thursday, 23 July 2015 - 11:51 AM