Unstoppable rise of the Uber economy

There’s a record 5.5m private firms because of the . . .

A RECORD 5.5m private sector businesses are now up and running in Britain as more people work for themselves, according to official figures.

More than 99pc of businesses are classed as ‘small’ – meaning they have less than 50 staff – while 76pc do not employ anyone but the owner.

The figures, from the Department for Business, Energy and Industrial Strategy, underline the growing number of people who are working for themselves in the UK.

This can include anyone from entrepreneurs hoping to build the next Google or Apple to consultants and tradesmen such as plumbers and electricians.

But it also takes in the growing number of the self-employed who get work through companies such as taxi firm Uber and room rental website Airbnb.

These businesses have boomed in recent years as an increasing number of people use firms which are based on mobile phone apps.

And many of these, including delivery firm JustEat, don’t actually even produce anything. Instead they rely on the army of small business owners and independent traders.

The report showed there are now 1.3m companies that employ people in the UK and 4.2m that do not – employing only the owner. Business secretary Greg Clark said: ‘Britain’s businesses are the heroes of our economic revival and it is great to see the number of businesses rise by over a million since 2010.

‘Our job creators don’t always get the praise and respect they deserve but we should be proud of our entrepreneurs, business leaders and innovators.

‘The Government is committed to ensuring Britain builds on its success and is the best place to start and grow a business.’

Adam Marshall, director general of the British Chambers of Commerce, said: ‘It’s great that the UK remains a fantastic place to start a business, and that we’re seeing more firms making the leap from start-ups to larger firms.

‘The challenge now, at a time of transition and change, is to ensure the best possible environment for businesses to invest, recruit and grow.’

A report by McKinsey Global Institute found that up to 30pc of people in the United States and Europe are working in the so-called ‘gig economy’.

This is where they cobble together an income by doing a series of ‘gigs’ rather than through a traditional job – with many enjoying the flexi- bility the arrangement brings. ‘The majority of independent workers in all countries participate by choice,’ said Susan Lund, a partner at the McKinsey Global Institute.

She said such work was ‘especially well-suited to seniors, stay-at-home caregivers, and young people – all large and growing demographic groups with an interest in working but with significant time commitments or reluctance to take nineto-five jobs’.

But critics worry that these workers do not enjoy employee protections such as sick pay and the minimum wage, and do not benefit from workplace pensions.

Labour MP Frank Field, chairman of the Work and Pensions select committee, has called such working conditions ‘bogus self-employment’.

Theresa May has launched an independent review of modern working practices ‘to make sure that the interests of ordinary working people are attended to and that no one is left behind in the workplace’.

The Prime Minister said: ‘Improving the security and rights of ordinary working people is a key part of building a country and an economy that works for everyone, not just the privileged few.

‘Flexibility and innovation are a vital part of what makes our economy strong, but it is essential that these virtues are combined with the right support and protections for workers.’