Freelancers will feel the latest inflation rise particularly badly compared to employees, IPSE (the Association of Independent Professionals and the Self-Employed) has warned. Contributor Jordan Marshall, Policy Development Manager – IPSE
The warning came after it was revealed that inflation had increased to 2.7 per cent in August – the highest level in six months. Jordan Marshall, IPSE’s Policy Development Manager, commented: “Freelancers will be especially hard hit by this jump in inflation not only because, unlike employees, they pick up their own business costs, but also because they travel more to win and work on different contracts.
They will particularly feel the effect of the 13.5 per cent jump in air fares, because many of them take up contracts overseas and travel long distances in the UK. “Like a lot of people in today’s labour market, many freelancers will struggle to ensure their earnings keep pace with the rising cost of living.
“On top of this, the UK’s 4.8 million self-employed also fear extra costs if the Government confirms its damaging changes to IR35 tax. Rising inflation also makes it more likely that the interest rate will be raised, potentially hurting self-employed people with property investments, but helping those frustrated by the low savings rates offered by banks.
“Despite these pressures, however, IPSE’s Confidence Index shows that freelancers’ underlying confidence in their businesses is still robust, with the majority expecting their business performance to improve in the next 12 months.”