Research released by Mettle, the NatWest-backed business account, using YouGov’s platform, estimates that the UK’s growing self-employed and side hustler movement will contribute an estimated £125 billion in turnover to the UK’s economic recovery in 2021. Furthermore, small and medium-sized businesses (with 1-49 employees) are estimated to contribute approximately £310.46 billion.
Pre-pandemic in 2019, the Office of National Statistics (ONS) found over 1.1 million people were either employed in two jobs or self-employed in addition to having another job. COVID-19 has only accelerated this and the growth of the self-employed and side hustler movement, with changes in employment and lifestyles pushing more people to work for themselves than ever before – either through choice or out of the necessity of being furloughed or made redundant. The population of self-employed workers in the UK now sits at over five million, making up 15% of the UK’s workforce.
Around 25% of all UK adults now consider themselves to be a side hustler, according to Henley Business School. Having ‘a side hustle’ in addition to a full-time job (from freelance design work to a passion such as wedding photography), has for the first time for many, become a necessity to supplement income.
Mettle’s research surveyed 2,194 self-employed workers to uncover the role of this segment in boosting the UK economy, the barriers they faced when starting their venture, and the role of banking organisations in helping them thrive.
According to the research, the most popular motivation for going solo was the flexibility and freedom it provided (57%), followed by their desire for a change in work/life balance (38%), and wanting more meaning and purpose in their life (24%). Those aged 55 and over are leading the way when it comes to self-employment, with 38% of limited companies and side hustles formed post-March 2020 having been established by that age group.
Increase in challenger banks
The rapidly expanding self-employed and liquid workforce movement is being supported by a rise in challenger banking solutions that provide online products and services. The majority (83%) of respondents who use challenger bank services and feel supported by them, felt this was because of the ability to do everything virtually, their bank’s ability to get things done quickly (61%) and the fact that their innovative technology and products are more compatible with their business needs (51%).
Compounding this, the COVID-19 pandemic is making the challenge of running a business or side hustle even more difficult. 57% of those surveyed are not looking to expand their business or side hustle or enter a new sector in 2021, with over a quarter of respondents specifically not looking to expand (29%) citing the UK’s economic uncertainty as the reason why. More than ever solutions like Mettle are of utmost importance to help this audience to manage their finances, and to support their maintenance, growth and contribution toward the UK’s economic recovery.
Marieke Flament, CEO of Mettle, said:“More people are choosing to start or create something of their own than ever before due to changing lifestyles, personal circumstances, or fulfilling a personal ambition. This research highlights the importance of this growing movement for the UK’s economic recovery in 2021 – particularly amongst the over 55 age group.
“The smallest end of the SME market has historically been underserved in terms of business banking, with the majority of incumbent institutions focusing on large commercial customers and corporates. This made it difficult for small business owners to get set up quickly, get paid and tax ready. We champion self-employed workers and side hustlers and are dedicated to building our product to serve them and their needs.
“As the UK looks to rebound from the economic damage caused by COVID-19, it’s absolutely vital that this segment has access to the support and services it needs to thrive. Banking doesn’t need to be complex, and we think new small business owners, self-employed workers and side hustlers should be able to rely on their bank to help them easily navigate day-to-day processes as they focus on overcoming the macro-economic hurdles outside of their control.”