One in five highly skilled freelancers expect to have to close their business

One in five highly skilled freelancers expect to have to close their business as a consequence of the restrictions brought in by lockdown, research suggests.

The research, which was conducted by the University of Edinburgh Business School in association with IPSE (the Association of Independent Professionals and the Self-Employed), surveyed more than 1,400 freelancers classed as highly skilled. Picture: AP Photo/Marcio Jose Sanchez

A study involving the University of Edinburgh Business School found that three quarters (74 per cent) of those freelancer had lost income as a result of the Covid crisis, with an average income fall of 76 per cent. As a result, over two thirds (69 per cent) say they now have cashflow problems.

The research, which was conducted in association with IPSE (the Association of Independent Professionals and the Self-Employed), surveyed more than 1,400 freelancers classed as highly skilled.

The overwhelming majority (91 per cent) said they could not access the UK government’s Self-Employment Income Support Scheme (SEISS), mostly because they work through a limited company. Average stress levels in this group have increased by 80 per cent because of the crisis.

Professor Francis Greene, chair in entrepreneurship and head of the entrepreneurship and innovation group at the University of Edinburgh Business School, said: “Covid-19 has brought in great economic consequences for the UK and freelance workers have been particularly hit by the pandemic.

“Not only have they seen work opportunities dry up as the country went into lockdown, but they have also suffered from a lack of financial support from government to ensure their survival.

“Our research clearly highlights these points and sheds some light into the dire situation this valuable working force is in at the moment, which is much worse that we had originally anticipated.”

One anonymous respondent said: “I have fallen through every single crack in this supposed raft of financial support measures. I cannot pay my bills. My income has gone from £4k a month to zero overnight.”

Meanwhile, the job market in Scotland faced “extremely challenging conditions” in May as permanent and temporary placements continued to fall sharply amid lockdown, according to new research.

Royal Bank of Scotland’s labour market report found that the drop in permanent placements in May was the second steepest in more than 17 years of data collection and extended the current “sequence of decline” to four months.

Many firms said they continued to put hiring decisions on hold due to “substantial uncertainty” surrounding the coronavirus pandemic.

Sebastian Burnside, chief economist at RBS, said: “The Scottish labour market continued to face extremely challenging conditions in May as lockdown restrictions to combat the Covid-19 pandemic continued.”

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