Solo-Entrepreneurship in Europe

Freelancers’ Need for Training

Unlike entrepreneurs who reply on a big idea, perhaps one that will change the world, freelancers’ primary value rests on their skills. Clients hire them for their skill-set, and it is their task to deliver an assignment based on their talent.

Freelance professionals provide specialist expertise to fill widening skills gaps and are required to be available when there are peaks in demand. The majority of them start their own business without help. They do not need formal training or conventional financing to get off the ground. They can usually begin trading without a business plan and they learn the ins and outs of their business as they progress. However, the only way they can grow and keep on remaining competitive is through continuously improving their skills.

Unlike employees, engaging a self-employed comes with the expectation that they will have the right skills and expertise to get the job done without time to get trained.

But the concern is that it is harder for the self-employed to access training than for any other group. Inexplicably, in several European countries, while all training for employees is tax deductible, the same does not apply to freelancers. For them this only applies to those core skills deemed specifically related a self-employed profession and not to “other” skills. Aside from its inherent unfairness, this is entirely illogical; when you’re a one-person business, all business skills are specific to your profession – there’s nobody else to get your books in order, update your website, devise a marketing plan or maintain client relations.

On top of that and unlike employees, freelancers have to pay for training themselves and take unpaid time off to actually do the training, which, if not planned for, can leave a big gap in their finances at the end of the month.

This imbalance is preventing a large number of freelance professionals from developing their skills. Further research has shown that while more than half of those in employment have taken up training in the last year (2015), that number falls to just 19% for freelance professionals.

More Policy Support Required

Training for micro-business creation and support should be included into local economic development strategies in Europe, making full use of the European Structural Funds, above all the European Social Fund.

Most current workforce development programs and employment agencies in Europe focus on job training and job placement, overlooking the opportunities that self-employment can offer, above all to unemployed and underemployed populations.

EURES national coordinators and employment agencies in all European countries should nominate a “Self-Employment Adviser”. S/he should be dedicated to actively point job-seekers towards becoming self-employed, rather than only entering an employment relationship. This is particularly relevant for people who can not or do not want a full-time job, due to childcare responsibilities, pursuit of education, ill health, recent retirement or for workers in rural areas with limited job opportunities.

Skills related to all forms of work-based learning should be promoted, even outside a formal full-time employment relationship. In addition, it is not only low‐skilled workers or employees (the main target groups of the New Skills Agenda for Europe) who need further training. Freelance professionals and highly educated self-employed workers also need re‐skilling, skills updating or professional development, especially in the context of digitalisation and its potential effects on employment.

It’ll also be important to ensure self-employment and entrepreneurship are on the curriculum at primary and secondary level schools.

A positive narrative should be created around entrepreneurship, and above all solo-entrepreneurship, to help engage young people from an early age.

Students should be equipped with the knowledge and skills to decide whether they wish to enter traditional employment, or work for themselves. Equally important is to ensure careers advice recognises self-employment and solo-entrepreneurship as an option within vocational and higher education. This should not only be limited to those studying specific courses on business and management.

The main challenge for many freelancers is to carry out an in-depth analysis of their own practice and business model and identify improvements and future opportunities. The real need therefore is specialist advice, one-to-one coaching and personalised mentoring tailored to the individual freelancer. This can be done through virtual platforms – like a European network of mentors – or in coworking spaces, with the Enterprise Europe Network overseeing a single portal with details of businesses that wish to provide mentoring.

Funding mechanisms, either government run or government backed, should also make mentorship and financial education a condition of funding, for instance requiring freelancers to have a mentor at the early stages of their business for at least two years and with regular engagement. Programs will need to be devised to help freelancers establish effective practices for managing their finances holistically. These should help them to learn how to cultivate diverse revenue streams, manage periodic income volatility and also include basic training about finance, bookkeeping and tax.

A Freelancer Speaks Up

For the series “Think Outside the Boss”, I have spoken to Tim, a 40 years old Independent Healthcare Medical Writer from Ireland. Here is what he told me:

“The main driver behind my work as an independent healthcare professional is a strong commitment and reliance on my skills and professional development. As an employee I had become a manager and had ceased to be the specialist medical writer that I am. I wanted to get back to that.

The problems I now experience are mostly related to awareness of developments within the pharmaceutical industry, which is subject to considerable regulation. My sector operates within strict codes of practice and standards that frequently change. There are also other changes constantly occurring within the context of my working environment, for example, relating to insurance, personal healthcare, social security, etc. Keeping up with these matters is difficult. As an employee, training was offered and paid for by my employer; as a freelancer, I am only able to access more expensive options from commercial training institutions or professional chambers, which usually target entrepreneurs in fast growth startups.

Governments should facilitate the establishment of affordable schemes that provide more flexible, up to date support, and skills enhancement, for instance in marketing, web technologies and financial management. What I need is to nurture a new set of skills related to self-management, self-promotion, self-marketing, self-administration, and self-development. This would be very helpful in allowing me and other freelancers to thrive in the 21st century economy”.

Marco Torregrossa is Secretary General at the European Forum of Independent Professionals and Managing Director at Euro Freelancers.

This post originally appeared on Linkedin here.

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