IPSE: Inflation increases not ideal

The Association of Independent Professionals and the Self-Employed (IPSE) voiced its concerns over the rise of UK inflation to 1.2%, its highest level in two years.

The IPSE fears rising inflation could potentially harm sole traders and other who work independently or travel significantly for business.

The rise in the consumer prices index (CPI) is 0.3%, up from 0.9% in October, largely driven by higher petrol and clothing prices, according to the Office for National Statistics (ONS), the highest reading since October 2014.

The IPSE said: “Freelancers travel further for work than any other group, so this may give them some cause for concern.”

Lorence Nye, economics adviser, IPSE, said: “There’s been downward pressure on freelancers’ average day rates in the past quarter, with more than half of freelancers also expecting Brexit to harm their business in the next 12 months.

“These factors combined have informed freelancers’ business outlook for the future, with 62% forecasting an increase in costs in the next year.”

However, it’s not just the UK’s freelance community that could be affected by rising inflation, it poses a threat to living standards generally across the country.

Frances O’Grady, General Secretary of the TUC, said: “Working people are facing over a decade of lost wage growth, with rising prices hitting their pay packets again.

“The Government needs to act fast to avoid another living standards crisis. That means a clear plan for Brexit that will protect jobs, pay and rights.”

Mike Cherry, National Chairman of the FSB, believes higher costs are harming companies overall.

“Our members have so far managed to absorb the increased costs resulting from inflationary pressures but the effects are now beginning to bite.

“Many small businesses rely on road travel to transport goods, receive supplies and for their staff to get to work so the rising cost of petrol is a major concern.”

Date published 15 Dec 2016 | Last updated 15 Dec 2016