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A new report has revealed that the state of the UK economy is one of the main reasons behind the recent fall in freelancer confidence.

New research from the IPSE (the Association of Independent Professionals and the Self-Employed) and PeoplePerHour shows that freelancers’ confidence in their own businesses for the next three months has fallen from -11.4 in Q2 2022 to -17.7 this quarter.

The Freelancer Confidence Index also found that the average day rate has fallen from £528 in Q2 2022 to £503 over the last three months.

Fred Hicks, Senior Policy and Communications Adviser at IPSE, commented on the findings, “Having endured a maelstrom of tax rises and worsening economic conditions, it is unsurprising to see that freelancer confidence continues to fall. But for it to plunge to the levels we saw at the height of the pandemic is yet another worrying indicator that the health of our freelance sector is at risk.

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“With costs set to rise but day rates lagging, the Q3 results are a reminder of the impossible choice freelancers must make between absorbing unaffordable cost increases, or risking client retention by increasing their rates.

“From programmers and designers to engineers and consultants, freelancers provide their services in all corners of the economy – a decline in the sector would be felt just as widely.

“Government must avoid piling further pressure on the already strained freelance sector at the next Budget and instead take the opportunity to deliver bold measures to support this dynamic and talented segment of the economy – from meaningful improvements to IR35 legislation and firm action to clamp down on late paying clients.”

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