SEISS UK: Small business owners intend to remain self-employed despite lack of support

Martin Lewis gives advice on the launch of the third SEISS

SEISS was launched to provide support to the self-employed who have been hit particularly hard by coronavirus. This was evidenced recently by a new report published by Simply Business, an organisation providing insurance to over 400,000 small businesses.

Following research conducted over the six months after the nationwide lockdown was introduced in March, Alex Thomas, the CEO of Simply Business, made the following comments: “Coronavirus has had a significant impact on all types of businesses – but it’s clear small businesses and the self-employed have been hit harder than most.

“With 67 percent saying that they’ve had to stop trading at some point in the past six months, our research has shown that COVID-19 could cost small businesses up to £69 billion in total.”

Indeed, the same research showed around 234,000 small businesses stopped trading as a result of the pandemic.

Additionally, 17 percent of small businesses detailed they thought they wouldn’t survive another lockdown.

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However, while the self-employed and small business owners have clearly struggled, a surprising amount of resilience and creativity was identified within the report.

The report detailed:

  • 85 percent of small business owners intend to remain self-employed
  • 10 percent are even planning to start a new business
  • One in five small businesses have adopted new technologies to adapt

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Concern over government support for the self-employed was also once again highlighted, with just 56 percent of small business owners accessing state support.

On top of this, 53 percent struggled to access government support or even understand the eligibility criteria.

One in 10 also shared they were concerned about being able to pay back the government support they’d taken out during the pandemic.

Alan concluded on this point: “The government has a clear duty to protect public health throughout the pandemic, but it’s obvious that any decisions – whether that’s on fiscal policy, further lockdowns, or future packages of financial support – will also have a huge impact on the rate of recovery for small businesses, and ultimately, the UK economy.”

On government support, additional research from FreeAgent (based on a survey of 500 UK based small business owners) found that less than 10 percent of respondents found the support offered through SEISS, bounce back loans and other measures was adequate, with 14 percent sharing they felt badly let down by the government.

When asked what would have been the biggest positive impact for them, the respondents cited the following:

  • More government support in the form of grants – 20.6 percent ranked this in first place, 58 percent in second place
  • Abolishing unnecessary red-tape and restrictions on small businesses – 21.4 percent ranked this in first place, 16.4 percent in second place
  • More government support in the form of fewer taxes – 17.2 percent ranked this in first place, 21.8 percent in second place

Ed Molynuex, the CEO and co-founder or FreeAgent, commented on these findings: “While the Government’s support packages have helped to reduce job losses, there is still a lot more that needs to be done to mitigate the impact of the pandemic on the UK economy.

“Small businesses and the self-employed, in particular, have been severely impacted by Covid-19, but many have not been eligible for the kind of support that they desperately need or are unable to identify if they qualify for support because of the complexity of the system.

“With Covid threatening the next six months – at least – of economic recovery, many freelancers and SMEs who are already feeling the strain will now be very worried about the future – particularly as we head into the New Year still uncertain on what restrictions will look like, how long they will last, and what impact they will have on businesses.

“It’s therefore important that every small business that can come through the crisis as a sustainable enterprise is provided with the support they need to stay afloat.

“Ultimately, they will benefit the economy and the UK will reap the benefits – in post-Covid times and beyond.”

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