Female self-employment is not a side issue for the UK economy. It is a major source of employment growth, innovation and household resilience. Yet the system that supports self-employed women has not kept pace with their numbers. A decade after the Prowess and Women’s Budget Group briefing Here to Stay: Women’s self-employment in a (post) austerity era warned that self-employment was growing faster among women than men but on worse terms, the evidence shows that little has changed.

The scale of female self-employment today

According to the Office for National Statistics, the UK had around 5.0 million self-employed people by the final quarter of 2025, with women accounting for roughly 1.8 million. That means women now make up more than one in three self-employed workers, up from just over a quarter before the 2008 downturn. Since 2008, the number of self-employed women has risen by more than half a million, even after the pandemic caused a temporary fall in overall self-employment.

This growth matters. Self-employed women run everything from solo consultancies and care agencies to online retailers and creative studios. They create jobs for others, fill gaps in local services and keep income flowing into households that might otherwise depend on a single wage. For a full picture of the numbers, see our Women in Business: Key UK Facts page.

Choice, necessity and the cost-of-living squeeze

For many women, self-employment is a positive choice. It can offer autonomy, flexibility and the chance to build a business around caring responsibilities, health needs or local demand. Yet for a significant minority, self-employment is not a free choice but a response to a labour market that does not accommodate them.

Public sector job losses, the rising state pension age, high childcare costs and a lack of flexible employee roles have all pushed women towards working for themselves. More recently, the cost-of-living squeeze has meant that some women have turned to self-employment as a way to top up household income, even when the work is insecure and low paid. For women considering this route, our First Self Assessment Tax Return: A Sole Trader Guide explains the first practical steps.

Earnings, productivity and the gender gap

Despite their growing numbers, self-employed women continue to earn far less than self-employed men. HMRC Self Assessment Income Statistics for 2022/23, the latest available, suggest median trading income for self-employed women is around £10,500, compared with roughly £17,000 for men. This gap has serious consequences: it limits women’s financial resilience, reduces pension savings and means the Treasury forgoes tax and National Insurance revenue that would otherwise support public services.

Productivity among the self-employed also remains a concern. ONS estimates indicate that output per hour worked by self-employed people is still below pre-2008 levels. Low earnings and stagnant productivity are not just personal setbacks; they weaken the wider economy. If you are already self-employed, reviewing your allowable expenses is one way to protect more of what you earn.

Sectors and the quality of self-employment

Part of the earnings gap reflects where women work. Self-employed women are concentrated in sectors such as caring, cleaning, hairdressing, creative services and online retail, where start-up costs may be low but hourly rates and margins are tight. By contrast, self-employed men are more likely to work in construction, IT consultancy and professional services, where day rates and contract values are typically higher. This occupational segregation means that simply encouraging more women to become self-employed is not enough; the quality and reward of that work matter too.

Pensions, protection and financial security

Self-employed workers are excluded from automatic enrolment into a workplace pension. IPSE research suggests only around one in five self-employed people is saving into a pension, and women are particularly exposed because they already face lower lifetime earnings and caring-related gaps. Without reform, many self-employed women risk poverty in later life.

Access to other forms of protection is also patchy. Self-employed mothers can claim Maternity Allowance, but they are not entitled to Statutory Maternity Pay or Shared Parental Pay. Self-employed people have no right to sick pay and limited access to statutory bereavement support. These gaps make self-employment far riskier for women than it needs to be. Our Maternity Pay Self Employed: A Complete UK Guide sets out what support is currently available.

Support, funding and a gender-blind enterprise system

Enterprise support in the UK is still not designed with women in mind. Men are more likely to access business support, bank finance and equity investment. The British Business Bank found that all-female founder teams received only around 2% of UK venture capital investment in 2024. The Alison Rose Review of Female Entrepreneurship has highlighted the economic potential of closing this gap, yet progress remains slow.

A woman-friendly enterprise infrastructure would include accessible finance, mentoring networks, childcare support and business advice that recognises the realities of women’s lives. Prowess resources on business grants for women and Start Up Loans for female founders offer practical guidance.

Policy changes and persistent barriers

Some recent policy changes have helped. From April 2024, employees have a day-one right to request flexible working, which should make employee roles more viable for women with caring responsibilities. The abolition of Class 2 National Insurance contributions and cuts to Class 4 contributions also reduce costs for many self-employed people. From April 2025, the National Living Wage stood at £12.21 an hour for people aged 21 and over, increasing pressure on women-led businesses that rely on staff but also raising the floor for low-paid workers.

However, major barriers remain. Universal Credit’s minimum income floor and capital rules can penalise newly self-employed women with limited savings. Self-employed parents still do not receive equal parental benefits, and childcare costs are harder to manage without employer-supported schemes. Official earnings data still largely excludes the self-employed, making it harder to measure and address pay gaps. The rollout of Making Tax Digital for Income Tax Self Assessment, now expected from April 2026 for many self-employed people, also adds new compliance obligations. Our Making Tax Digital Sole Trader: 2026 Checklist for Women explains what to prepare.

What needs to happen next

The 2016 Prowess and Women’s Budget Group briefing set out a clear agenda. Updated for 2026, its recommendations still hold:

• Build a woman-friendly enterprise support infrastructure that reaches women at every stage of business.
• Equalise parental benefits for self-employed parents, including access to shared parental pay and better paternity support.
• Strengthen flexible working rights and promote quality part-time and flexible employee jobs.
• Reform Universal Credit so that capital limits and the minimum income floor do not trap low-income women in insecure self-employment.
• Collect and publish gender-disaggregated data on business support uptake, earnings and pensions.
• Include the self-employed in official earnings statistics through an ‘all worker’ measure.
• Extend pension auto-enrolment to the self-employed and improve access to childcare for self-employed parents.

Conclusion: why action cannot wait

Female self-employment is not a marginal trend or a lifestyle luxury. It is a central feature of the UK labour market and a key source of employment growth. If the UK wants a recovery that is genuinely inclusive and sustainable, policymakers must stop treating self-employed women as an afterthought and start investing in the infrastructure, benefits and data that would let them thrive.