The rise of the 'redundant-preneur'
The research found that Britain is home to millions of ‘redundant-preneurs’ - people who took being laid off work as an opportunity to work independently rather than find another job working for someone else.
After being made redundant, more than a third of people decided to use the opportunity to become their own boss. Of these, 57 per cent started working for themselves as a freelancer or consultant, 48 per cent started a business and 12 per cent invested in another business and started working there. The new businesses joined the millions of micro businesses, those with fewer than 10 employees, operating in the UK, which account for 96 per cent of all companies.
Karneet Chowdhury, business manager at Direct Line for Business, which carried out the research, said: “Being made redundant can be one of the most stressful and unsettling periods of anyone’s working life. But it can also be a catalyst for change and force people to take a step back and think about what they want in their future career.
“It’s great to see so many people have turned redundancy into a positive experience by starting their own business and working for themselves. This entrepreneurial spirit is why there are so many small businesses across the UK providing numerous products and services."
The industries most choose following redundancy are education, which accounts for 18 per cent of post-redundancy businesses and retail at 17 per cent. One in nine choose to start their own business or management consultancy while similar numbers have set up their own IT or web design business or engineering firm.
Nearly 13 million - 38 per cent- of UK working adults have been made redundant at some point in their careers, with men more likely to be made redundant than women. Many people retrospectively feel it was a positive change. Over half were unhappy about being made redundant at the time but think it was for the best. Just 10 per cent are unhappy with their business’s performance since it was set up, with 39 per cent saying that their business has performed better than expected. Just two in five would like to go back to being an employee in the future.
The main reasons for people choosing to work for themselves after being made redundant are that they wanted to try something different, or liked the idea of being their own boss. Over a quarter meanwhile, thought they could earn more money while working for themselves. For others, redundancy provided the ideal opportunity to do something they had always wanted to but never had the required lump sum investment or the time.