The new minimum wage, or as the Government likes to confusingly call it the ‘National Living Wage’, somewhat lower than the Living Wage kicks in this week on the 1st of April.
Many around the country will be celebrating a small pay rise if their employers haven’t already upped their wages, but one group is set to miss out – the self employed and this includes many eBay, Amazon and other marketplace sellers.
The Government says “If you’re working and aged 25 or over and not in the first year of an apprenticeship, you’ll be legally entitled to at least £7.20 per hour“. What they mean is if you’re employed you’re about to get a 50p pay rise but if you’re self employed you may not be earning the minimum wage.
Research by the Social Market Foundation suggests that there are 1.7 million self employed people who will earn less than the minimum wage. They discovered that 49% of the UK’s self-employed are in low pay, measured on an hourly basis, compared with just 22% of employees.
What’s even more distressing is that the number of self employed people on low pay is growing and it’s expected that by 2020 there will be 1.9 million self employed earning less than the minimum wage.
We hope that not too many Tamebay readers earn less than the minimum wage, but we know many out there put in long hours and suspect that some do. For some it may be worth it, perhaps due to circumstances finding other employment isn’t possible or you’re time rich and cash poor.
The introduction of the Living Wage is however a good time to reassess what you earn, figure out what your hourly rate is and, no matter how much you earn, figure out if you could increase your hourly rate. This could be by cutting out unnecessary tasks, using automation to save time or perhaps even ditching some of your lowest margin lines and concentrating on products which generate higher profits.
I won’t ask if you’re happy with what you earn as I suspect pretty much everyone wishes they could earn more. Instead tell us your best tips for increasing your hourly rate and share how you have made your business more profitable.