Self-employment in Scotland: trends and its implications for productivity

Graeme Roy (Editor), Kenny Richmond, Jonathan Slow

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    Abstract

    Self-employment in Scotland has grown significantly in recent years, faster than in many other countries. It has accounted for almost half of overall employment growth over the past decade and over 80% of the growth in the number of businesses in Scotland. Self-employment in Scotland, however, accounts for just over 1 in 10 jobs, lower than in many other countries. This paper outlines recent trends in the growth in self-employment in Scotland, summarises the likely reasons, highlights the characteristics of the self-employed and considers the implications for productivity and economic growth. It notes that productivity levels of self-employed businesses are significantly lower than larger businesses, as are earnings of the self-employed vis-à-vis employees. The fast growth in the number of low productivity, self-employed businesses in Scotland may, in part, explain Scotland’s overall mediocre productivity performance.
    Original languageEnglish
    Pages (from-to)66-75
    Number of pages10
    JournalFraser of Allander Economic Commentary
    Volume41
    Issue number2
    Publication statusPublished - 29 Jun 2017

    Keywords

    • Scottish economic activity
    • Scotland
    • fiscal framework

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