Status of self-employed people

In Spain, there are approximately 3.4 million self-employed people, representing 18% of the total working population. Spanish self-employed people are more likely to be men, between 40 and 49 years old, and usually set up their business in the service sector. In addition, they work more hours than employees do and have lower educational attainment.

An extensive report on the ‘ Regulations governing self-employed people (1Mb pdf; in Spanish)’ was presented during October 2005. The report, commissioned by the Spanish Ministry of Employment and Social Affairs (in Spanish) and prepared by a group of experts, has two aims. Firstly, it assesses and evaluates the economic and social situation of Spanish self-employed people. Secondly, it analyses the current legal and social protection framework regarding self-employment and includes a number of proposals for a new law on self-employment, which, after discussion with relevant parties, will be passed next year.

Profile of self-employed people

As defined by the Spanish Labour Force Survey, self-employment refers to occupied people who exert an economic activity of their own account. However, it is possible to identify different kinds of self-employment, ranging from individual professionals with no employees, to small employers, to so-called ‘economically dependent’ workers, i.e. self-employed from a legal perspective but economically dependent on an employer.

According to the information available in the Spanish Labour Force Survey, there are approximately 3.4 million people in self-employment (data for first quarter of 2005), which represents 18% of the total Spanish working population. Eurostat data cited in the report show that this level is lower than the EU average as a result of a decreasing trend during the last decade, which has been more acute in Spain than in other countries.

Most Spanish self-employed people are individuals with no employees (60% of the total), while 27% have employees, and the remainder correspond to other self-employed categories, e.g. members of cooperatives.

Andalucia and Catalonia are the two regions with the highest numbers of self-employed people (16.4% and 16% of total Spanish self-employment, respectively). However, and in relative terms, self-employed people represent the largest share of total regional employment in Galicia and Extremadura (27.6% and 22.5% of total regional employment, respectively).

Gender breakdown

In terms of gender, men represent 68% of all self-employed people in Spain. This gender bias is also noticeable when the relative presence of self-employment is taken into account. Thus, self-employed men represent 21.3% of all occupied men, whereas this ratio is significantly lower among women (15.1%). The largest proportion of self-employed men are between 40 and 49 years old (27.8% of all self-employed), followed by the 30-39 year old group (26.3%). There are no important differences in terms of age categories between men and women.

Table 1: Number of self-employed people, first quarter 2005
Number of self-employed people, first quarter 2005
  Total (000s) Men (000s) Women (000s)
16-29 years old 471.0 320.1 150.9
30-39 years old 915.8 609.3 306.5
40-49 years old 968.0 656.1 311.9
50-59 years old 789.6 541.5 248.1
60 years old 341.5 250.8 90.6
Agriculture 538.8 384.0 154.8
Manufacturing 402.5 308.2 94.3
Construction 466.3 429.5 36.8
Services 2,078.2 1,256.0 822.2
Total 3,485.8 2,377.7 1,108.1

Source: Regulations governing self-employed people, Spanish Ministry of Employment and Social Affairs, 2005

Sectoral breakdown

Most Spanish self-employed people (up to 59.6%: 74.2% women, 52.8% men) are engaged in the service sector. However, and in relative terms, self-employment is particularly prevalent in the agricultural sector (representing 53% of the total sector employment), well above the proportion in the construction, service and manufacturing sectors (20.5%, 17.4% and 12.4%, respectively). Nonetheless, over time, it is possible to identify an increase in self-employment in construction and services in contrast with a decrease in self-employment in agriculture and manufacturing.

Foreign workers

Currently, an increasing number of foreign workers are opting for self-employment. Taking the first quarter of 2005 as a reference, there were 223,000 self-employed people of foreign or dual nationality, which represents 6.6% of all self-employment in Spain. However, the relative level among foreigners (11% of all working non-nationals) is lower than among Spanish nationals. There are slightly more foreign self-employed women than their male counterparts.

Working hours

The average number of weekly working hours among those who are self-employed is higher than among employees (six hours more, on average), with the largest differences being found in the transport and hospitality sectors (eight and 12 hours more, respectively).

Table 2: Number of weekly working hours, comparing self-employed and employees, first quarter 2005
Number of weekly working hours, comparing self-employed and employees, first quarter 2005
  Self-employed Employees
Agriculture, hunting and forestry 47.4 40.9
Fishing 34.8 46.8
Mining and quarrying 43.5 42.4
Manufacturing 43.3 40.4
Construction 42.8 41.7
Wholesale and retail trade; repair of motor vehicles, motorcycles and personal and household goods 43.1 39.3
Hotels and restaurants 51.4 38.6
Transport, storage and communication 48.3 40.3
Financial intermediation 40.0 39.4
Real estate, renting and business activities 42.1 36.8
Education 30.8 32.0
Health and social work 34.4 36.6
Other community, social and personal service activities 37.7 35.7
Total 37.7 38.2

Source: Regulations governing self-employed people, Spanish Ministry of Employment and Social Affairs, 2005

Education level

The average educational level of self-employed people is lower than among employees. However, over time it is possible to identify an increase in educational attainment, especially among self-employed women and young people.

Self-employment is a stable employment option, in so far as more than three-quarters of self-employed people have been in this employment status for more than six years. More than 60% of self-employed men and more than 50% of self-employed women remain in self-employment for six or more years.

Proposals for law on self-employment

The report also includes a number of proposals for a new law on self-employment. The most important recommendations are intended to modify the special social security status for self-employed people in order to bring it more into line with the general social security status. The main proposed changes include:

  • regulating part-time self-employment;
  • exempting newly self-employed people from contributing to the social security system when their incomes are lower than those of the legal minimum salary;
  • protecting maternity benefits and associated risks for pregnant self-employed women;
  • regulating early retirement options for self-employed people;
  • setting up a special guarantee fund for cases where a self-employed person definitively stops his/her labour activities.
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