As 2020 draws to a close, it’s safe to say that it’s been a tumultuous year for many industries across the globe. Employees, contractors and freelancers have been feeling the strain brought by the COVID-19 pandemic, but there’s a silver lining for the self-employed.
With all the uncertainty the pandemic brought, along with Brexit concerns, there could be a significant increase in firms hiring contractors in the coming years. Contractors and freelancers can expect to take advantage of upcoming opportunities as employers look to outsource jobs that would previously have gone to permanent employees. Here’s a look at why 2021 could be a great year for contractors.
Contactors Boost Productivity
With Brexit on the horizon and the UK struggling to pull through from the aftermath of a pandemic, there’s no question that employers will be looking to save money in 2021. They’ll want to get the most from the people they employ and look for more cost-effective ways to do so.
A study by Trinity Business School and the University of Derby has found that companies with, at least, an 11% contractor workforce are more productive and that their employees generate, on average, an extra £4,669 for their company. This increase in productivity also helps to aid the UK’s economic recovery, with research suggesting that hiring more freelancers and contractors could create thousands of new jobs.
Contractors bring specialist skills and expertise to a company, boosting their core workforce, and helping to accelerate growth. As employers recover from COVID-19 and deal with any upcoming repercussions of Brexit, they’ll be looking for innovative ways to save on costs and bring in fresh, new ideas to boost their business. Freelancers and contractors can expect to take up these new roles in the coming years.
Boom for Freelancers
We can expect significant growth in the demand for freelance workers as a result of COVID-19, with 47% of hiring managers expected to employ independent professionals in the future, according to research by Upwork.
There were more than five million self-employed people in the UK in the fourth quarter of 2019, up from 3.2 million in 2000.
While the demand for freelancers is predicted to rise, a million self-employed workers are planning to give up being self-employment due to the pandemic. A study by LSE’s Centre for Economic Performance found that in August 2020, 58% of the five million self-employed people in the UK had less work than usual, with a fifth anticipating quitting altogether. The pandemic has put into perspective the downsides of self-employment.
However, more than a quarter of self-employed people who work through digital apps in the gig economy claimed to have had more work than usual in August.
And, with more employers looking to outsource work, for those who wish to pursue freelance jobs, now is a great time to get started and take advantage of the increase in the number of companies looking to hire contractors and freelancers.
Remote Working: The New Normal
The first national lockdown in the UK saw thousands of people working from home for the first time. The number of people working exclusively from home rose from 21% to 24%, and the official figures showed that exclusive remote working hit a high of 37% in mid-June.
Some businesses have already seen the benefits of remote working and have switched to an entirely remote workforce, selling or leasing their commercial properties to help retain their cashflow following the pandemic. We can expect more companies to follow suit in the future.
This shift to remote working has opened up opportunities for freelancers and contractors. Many employers have previously been against home-working, making them averse to outsourcing work to contractors or freelancers where they could not monitor their employer in the workplace.
Now that working from home has become standard across so many industries, freelancers and contractors could benefit from these changes in people’s attitudes to remote working. Those employers who were mistrustful of remote working have now seen how great it can be for productivity and costs. Contractors and freelancers could see an increase in demand brought on by these shifting attitudes now that more employers are willing to have work completed outside of their physical workplace.
This year has brought many challenges to so many workers across the UK. If you’re a freelancer or a contractor, Gorilla Accounting can help you with your finances, keeping everything in order, and ensuring that you’re meeting your legal obligations. We are expert contractor accountants who can offer you a comprehensive accounting service, including 24/7 access to FreeAgent accounting software.
To learn more about our services and how our limited company accountants can help, contact us today.
