Thinking about starting your own business? Self-employment rises steeply in the over 50s

18 March 2015

Saga report reveals that self-employment in the over 50s is rising with increasing numbers starting their own businesses.

A comprehensive report from Saga has revealed that many of the over 50s are showing their entrepreneurial flair by choosing to become self-employed.

Self-employment is increasing significantly with the numbers rising by 23% among the over 50s and 45% for the over 65s in the four years to June 2014. This compares to just 13% for people in the 25-49 age group. Older workers said they enjoyed the independence that self-employment brings.

Saga’s detailed study of employment among the over 50s – Generation Work – draws on the results of a Saga Populus poll of 11,168 over 50s and analysis of economic and employment data carried out the independent Centre for Economics and Business Research (Cebr). 

Read our tips for raising money to start a new business.

Increasing numbers of over 50s are experiencing unemployment

The Generation Work report also identifies a darker side to the labour market’s view of over 50s workers which shows a growing number experiencing long-term unemployment. 

The number of over 50s in long-term unemployment as a proportion of total long-term unemployment grew by 20% between October and December 2010 and the same months in 2014. In contrast, the share of people in long-term unemployment in the 25-49 age group fell by 14% in the same time period. 

In 2014, around 356,000 people aged over 50 were unemployed.

These findings suggest that the over 50s are less likely to get back into work if they find themselves unemployed, compared with younger generations and this problem could deepen without policy interventions.

Read our guide to job hunting for the over 50s

Saga calls on the Government to support the over 50s back into work

Saga Director of Communications Paul Green commented:  “The Saga report raises a range of issues for both government and employers. 

The Government must ensure that unemployed over 50s can be supported back into work through schemes that help match over 50s’ skills to business needs and encourage employers to accept older workers.  More help is needed with employment and training measures, including over 50s apprenticeship schemes.

“Saga is also urging the Government to abolish national insurance contributions for employers who take on workers who have been unemployed long-term.

“In addition, more training and advice on setting up a business and start-up funding would tap into the desire for greater self-employment.”

Thinking of setting up as a sole trader? Read our tips.

The report also found that:

  • Over the last four years the number of over 50s working has increased by 12% bringing them to just over 9 million of the workforce. This will increase to over 10.7 million by 2020.

  • A key reason the over 50s are remaining in work was to support their lifestyles – with 83% of working respondents citing this; more than half, 56% also said they worked for the social aspects.

  • Many over 50s are delaying their retirement plans with 23% reporting that they plan to retire later than they expected to five years ago and 18% saying that they have put their retirement plans on hold, indefinitely; only 8% report that they plan to retire earlier than they expected to 5 years ago.

  • The median gross weekly earnings of workers aged between 50 and 59 is £556 - 7% more than the gross weekly earnings of the average employee. But this falls to £491 for works aged over 60 - 5% less than the UK average.

Click here to download the full report...

Are you considering starting your own business? Read our guide to financial planning for the self-employed.

The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.