Self-employment Dynamics and 'Transitional Labour Markets'

Some more UK evidence

Meager N | Working Paper WP12 | Institute for Employment Studies | Feb 2007

This paper looks at some aspects of the potential role of self-employment in transitional labour markets (TLM), building on previous work by the author (Meager and Bates, 2002).

The question we were concerned with was whether self-employment transitions operate as positive or negative contributions to labour market dynamics.

Do they, on the positive side, help to keep people attached to the labour market who might otherwise fall out; or offer entry routes to people who might otherwise not get into the labour market; or improve the career trajectories of people who might otherwise end up in social exclusion or low wage traps?

Or, on the negative side, are they associated with worse outcomes than other kinds of transitions, or with low wages, social exclusion etc.?

This paper reviews and adds to the evidence on these for the case of the UK.