Fintech firm Portify said each month income remains at these levels, an estimated £1.5bn in earnings and £6.9bn in economic contributions will be lost across 4.8m self-employed workers.
Sho Sugihara, Portify’s co-founder, said: “We welcome the support the Chancellor has offered to gig economy workers UK, but our data shows that these workers are struggling today. A bailout package that’s two months away might be too late to help those already feeling the strain put on them by COVID-19. That’s why we have not only released this report, along with our recommendations for the UK government, but are also in conversation with external partners to create a solution that would alleviate the strain on the self employed before the Treasury package will take effect in June."
Disposable income expenditure fell by 60 per cent as social distancing policies came into effect and consumers tightened their spending. In addition, expenditures on bills and utilities are showing early signs of decline.
Income from loans also fell by 56 per cent for gig workers and 44 per cent for regular salaried workers, potentially signaling the tightening of consumer credit markets even as the Bank of England cut rates to 0.1 per cent, its lowest rate ever.
The report also outlines three key recommendations for the UK government; moving up the implementation date of the scheme, exploring options to guarantee loans for the self-employed as it has for SMEs, and for the UK government to understand the importance of supporting self-employment throughout the crisis, as the self-employed will likely be a major driver of economic activity and recovery that follows any COVID-19 induced recession.