This article updates a 2021 report by Erika Watson of Prowess, commissioned by the Women’s Budget Group for the Commission on a Gender-Equal Economy. The original report was written at the height of the COVID-19 crisis. The policy landscape has shifted since then, but many structural barriers facing self-employed women in the UK remain. The executive summary and recommendations below reflect the position as of mid-2026.
Self-employed women in the UK: executive summary
Since the 2008 financial crash, the rise in female self-employment has helped absorb economic shocks. The original Prowess report found that, over the decade to 2020, self-employment among women in the UK grew faster than any other employment category, increasing by more than 40%, roughly double the rate for self-employed men. Although the pandemic caused a temporary fall, women have continued to return to self-employment. By mid-2026, self-employed women UK-wide again make up a substantial share of the self-employed workforce.
Yet financial resilience among self-employed women has not kept pace. While self-employment works well for those who are established and have assets, a significant minority, disproportionately women, are low-paid and insecure. The gig economy and platform work have often reproduced, rather than removed, gender inequalities, and women remain under-represented in the higher-growth tech and STEM sectors.
Changes to tax, benefits and social security have been particularly harsh for self-employed women. The design of Universal Credit left many low-income self-employed claimants worse off than they would have been as employees or unemployed, and the COVID-19 Self-Employment Income Support Scheme excluded some of the most vulnerable groups. More recently, the abolition of Class 2 National Insurance contributions from April 2024 and the delayed rollout of Making Tax Digital for Income Tax Self Assessment have changed the administrative landscape, though not always in ways that help the lowest earners.
Flexible, often part-time, self-employment has historically enabled disabled people, carers and lone parents to keep their skills, income and dignity. Where Universal Credit and the Minimum Income Floor made that way of working impossible, the loss was felt not only by individuals but by families, communities and the social care system.
The pandemic exposed how much economic risk has been shifted onto individuals. Many emergency measures have now ended, but the underlying problems persist. A serious review of how the flexible labour market and social security system support self-employed women is still urgently needed.
1. Fair income support for self-employed women
The Self-Employment Income Support Scheme launched in 2020 and closed in September 2021 after five grants. It supported millions, but gaps remained. The newly self-employed, who started after April 2019 and were disproportionately women, were excluded from the first two grants because they had not filed a 2018-19 tax return. Later grants used 2019-20 returns, but only if filed by the deadline, leaving some still without support.
The scheme also failed women who had taken maternity, adoption or shared parental leave during the reference period, because their trading profits were lower than usual. Following legal challenges and campaigning, HMRC allowed some parents to use an alternative reference year for the fourth and fifth grants. However, the scheme has now ended and there is still no permanent safety net for the self-employed.
Recommendation 1
Any future income-support scheme for the self-employed must be designed with women’s working lives in mind from the start. That means including recent start-ups, recognising maternity, adoption and caring interruptions in profit calculations, and creating accessible contingency support for those whose earnings are disrupted by health, care or economic shocks.
2. Equalise parental benefits for the self-employed
Self-employed mothers are still not entitled to Statutory Maternity Pay. Instead, most claim Maternity Allowance, which pays a flat weekly rate for up to 39 weeks. Unlike Statutory Maternity Pay, there is no higher earnings-related rate for the first six weeks. Self-employed parents remain excluded from Statutory Paternity Pay, Shared Parental Leave and Shared Parental Pay, and from the right to return to self-employment after time out.
Recommendation 2
Equalise parental benefits so that self-employed parents receive equivalent support to employees, including an earnings-related maternity payment, access to paternity and shared parental pay, and protection against loss of work while caring for a new child.
3. Incentivise retirement savings for self-employed women
Self-employed women continue to fall behind employed people and self-employed men in pension saving. Research consistently shows that self-employed women are less likely than employees and self-employed men to be contributing to a private pension, so the gender pension gap among the self-employed is severe.
Recommendation 3
Introduce targeted incentives for pension contributions and long-term savings products for the self-employed, with particular outreach to women on low and intermittent incomes. Simpler products, matched contributions and integration with the tax self-assessment system could all help close the gap.
4. A skills strategy for women in business
Occupational segregation persists. Women are more likely to be self-employed in caring, creative, administrative and personal-service sectors, while men dominate construction, transport and IT. Female solo self-employment has grown rapidly, yet mainstream business support, much of it publicly funded, still tends to target larger, employer-led ventures and can exclude the solo self-employed.
Because publicly funded business support is subject to the Public Sector Equality Duty, providers should be required to demonstrate equality of outcome, not just access.
Recommendation 4
The government should adopt a skills and enterprise strategy for women in business, including female-focused STEM training, coaching, business incubation and support for solo self-employed women. Funders should collect and publish sex-disaggregated data on who receives support and what outcomes they achieve.
5. Reform social security for a post-COVID economy
Universal Credit for the self-employed has changed since 2021. The £20 weekly uplift introduced during the pandemic ended in October 2021. The Minimum Income Floor, which assumed self-employed claimants earned at least the National Living Wage regardless of actual income, was suspended from March 2020 and reintroduced from August 2021. Campaigners have continued to press for its abolition or reform, because it penalises people whose earnings fluctuate through caring responsibilities or ill health.
The £16,000 savings limit for Universal Credit also remains, which penalises self-employed people who need a cash reserve for their business. Most self-employed women continue to shoulder a disproportionate share of unpaid care and domestic work, making rigid conditionality and reporting requirements difficult to meet.
Recommendation 5
Ensure that any reform of the Minimum Income Floor genuinely improves incomes for low-earning self-employed women, and review the £16,000 savings limit so that it does not force self-employed people to deplete business reserves before they can get help.
Recommendation 6
The pandemic showed that individuals cannot be expected to absorb economy-wide shocks alone. The government should commission a Citizens’ Jury, or similar deliberative process, to examine the role of a more universal social security floor, including Universal Basic Income or a guaranteed minimum income, in supporting carers, disabled people and the self-employed.
What self-employed women can do now
While policy change is needed, there are practical steps you can take to strengthen your position today:
- Check your Making Tax Digital for Income Tax Self Assessment obligations. From April 2026, self-employed people with turnover above £50,000 must keep digital records and submit quarterly updates through compatible software. The threshold drops to £30,000 from April 2027.
- Review your allowable expenses and home-working claims to make sure you are not overpaying tax.
- If you are pregnant or planning a family, check your Maternity Allowance entitlement and consider how you will manage the gap between statutory payments and your usual income.
- Start a pension contribution habit, however small. Even modest regular payments into a personal pension or Lifetime ISA can reduce the gender pension gap over time.
Conclusion
Updating this report in 2026 makes clear that the post-pandemic economy is not yet fairer for self-employed women in the UK. Closing the gaps in income support, parental benefits, pensions, skills and social security would be a significant step towards the resilient, gender-equal economy the original report envisaged.
