Disabled entrepreneurs are an essential part of the UK economy, with disabled-owned small businesses accounting for 8.6 per cent of the turnover of all UK businesses.

Disabled people in work are more likely to go into self-employment than non-disabled people in work. While sometimes this option is because of a lack of appropriate employment prospects, there are many disabled entrepreneurs who have chosen self-employment to fill a gap in the market, to disrupt a sector, or simply to have control over their own time.

Despite the prevalence of disabled people and those with a health condition entering self-employment, support available for them to start and grow their business is lacking. Disabled entrepreneurs are less likely to use business support than their non-disabled counterparts, with the absence of accessibility of many traditional forms of support being a key barrier. Banks, local government, and professional advisors must consider their offer to disabled people, but support should also be delivered through channels more commonly used by disabled entrepreneurs, such as peer networks. The DWP’s disability enterprise offer also needs improvement if Government want to create a new culture of enterprise. The successful New Enterprise Allowance should be reinstated, with higher weekly payments and more availability of mentors.

Key findings and recommendations

Expand each panel below to read our key findings and recommendations for each area. You can read our full list of recommendations along with data they are based on by downloading the report at the bottom of this page. 

Entrepreneurs, disability, and health

Key findings:
  • 25 per cent of small business owners are disabled or have a health condition.
  • 23 per cent of business owners who are disabled or who have a health condition have experienced discrimination or negative treatment.
  • 52 per cent have experienced a barrier due to their having a disability or health condition,such as not being able to commit to consistent hours or meet short deadlines (34%), when applying for financial support (15%), and lacking access to equipment (11%).
  • 41 per cent of disabled business owners have used no business support, compared with 35 per cent of non-disabled business owners. They are more likely to use informal support, such as FSB networks (15%) and other networks (19%).
  • 13 per cent of business owners who are disabled or who have a health condition have used Access to Work. 35 per cent have not heard of the scheme at all, and 25 per cent were not aware that it was available for the self-employed.
  • 24 per cent of small business owners say they have a mental health condition.
  • 34 per cent of small business owners say that their mental health has declined in general over the course of the COVID-19 pandemic.

Case Study 

Julian John, Professional services, Wales
FSB Disability, health, and wellbeing Policy Chair

Julian John is the founder of award-winning consultancy Delsion. Having recovered from brain damage in 2005 which left him with limited mobility, Julian realised there were many barriers for disabled people returning to work. With his HR background, he established Delsion in 2015, which focuses on diversity and inclusion, and learning and development. He has since made Swansea the first Disability Confident city in the UK. He is listed as one of the most influential business leaders in the UK in the Shaw Trust Power 100 and was included in the People Management Diversity & Inclusion Power List 2020. Julian set up Delsion both because he was long-term unemployed and struggling to find employment, and because he had spotted a gap in the market which the business could fill to offer something new. In addition, self-employment offered him the flexibility he needed in work.

Our recommendations: 

The Department for Business, Energy & Industrial Strategy (BEIS) should set a target to grow the number of disabled entrepreneurs by 100,000 by 2025, and over 250,000 by 2030. A disability entrepreneurship gap exists, and government should act to help close it. This report highlights the economic, social and health benefits of entrepreneurship by disabled people to the UK. This should sit alongside efforts to close the disability employment gap as a whole.

BEIS should produce condition-specific ‘Pathways to Entrepreneurship’ strategies, to address the differing barriers faced by those with different conditions. Not every disability or long-term health condition impacts entrepreneurship in the same way. The Government has sufficient resource to undertake complimentary condition-specific work as well. This should be similar in governance and scope to the sector strategies previously published by BEIS in the past, working with relevant stakeholders.

The Department for Work and Pensions (DWP) should replace the scrapped New Enterprise Allowance with a more ambitious scheme, and ensure Disability Employment Advisors are appropriately trained to enable self-employment. The NEA helped thousands of disabled people start a business before it was closed in December 2021. There is a strong case for replacing the scheme with a more substantial successor – providing both additional support and increased weekly payments. Both new and existing DEAs should be appropriately trained on self-employment and be encouraged to make schemes like an NEA replacement available to disabled jobseekers.

DWP should scrap the ‘one-chance-only’ rule that prevents disabled entrepreneurs using the Government’s Access to Work scheme. The qualification rules should be amended to allow those who have previously failed the business viability test to re-apply as soon as their business returns to viability, rather than the current five-year ban. This would support disabled entrepreneurs who might have experienced a period of ill health, thus failing the viability test, to gain support as soon as they are able to grow the business again. Government should also ensure that business plan requirements do not create a barrier to disabled entrepreneurs.

The British Business Bank should launch a Disability Angels CoFund, based on the Angel CoFund, and provide funds for additional start-up loans ear marked for disabled entrepreneurs. Government has taken significant action through the BBB to improve access to equity funding. There is a case for extending this action with the aim of enabling disabled entrepreneurs to access early-stage capital more easily. The BBB’s start-up loans have performed well in widening access to entrepreneurship, and providing additional funding for new start-up loans, specifically for disabled entrepreneurs, would provide a clear route for potential disabled entrepreneurs to start a business.

UK Government should require major banks to measure and publish the proportion of loans given to disabled entrepreneurs. This should mirror the Rose Review recommendation with regards to female entrepreneurship funding transparency. Disabled entrepreneurs are less likely than non-disabled entrepreneurs to use banks as a form of business support. Banks have undertaken a considerable amount of work to increase accessibility and provide protection for vulnerable customers and should be commended for doing so. Collecting and publishing data on the proportion of loans granted to disabled entrepreneurs would be a hugely important continuation of this work.

UK Government should address the critical gap in enterprise data through exploring the collection of disability data points in government data, such as through the Small Business Survey, and adding a voluntary tick box to the VAT Return form or the Annual Returns form submitted to Companies House. It would be beneficial to have data broken down by disability type, as disabled people are not an homogenous group, but this will need to be balanced with what information people are happy to disclose, and ensuring data are
usable with robust base sizes.

Small businesses and disability employment

Key findings: 
  • 51 per cent of small business employers have employed a disabled person or someone with a health condition in the last three years.
  • 91 per cent of small business employers offer flexible working, rising to 97 per cent of those who employ a disabled person.

Case Study:

Alan Jewitt, SYPO, North West

SYPO is a website development and design business established in Kendal by Alan Jewitt. When an employee disclosed their autism during the interview process, the business had its first experience with making adjustments, such as offering flexible working and making changes to the work environment. After the experience with this employee, SYPO then felt able to offer opportunities to other people with autism. It has offered work experience independently and through Building Better Opportunities, and now has a second member of staff with autism on a permanent basis. “ I think it’s all about understanding and informal flexibility based on the individual. This has enabled us to create an autism-friendly work environment.”

Key recommendations:

The UK Government should introduce a one-year Employer National Insurance Contributions holiday on the wages of newly recruited disabled employees, following the successful introduction of a NICs holiday for armed forces veterans, instituted in 2020. There is a need to incentivise recruitment of disabled people at all stages of their careers, and a need to ensure the viability of those firms that employ large proportions of disabled employees.

The UK Government should introduce a ‘Kickstart’-style disability employment scheme to get more disabled people into employment for the first time. The Kickstart scheme was an effective measure in helping disabled people at risk of long-term unemployment to gain work experience to progress successfully into employment. Unfortunately, eligibility for Kickstart included a requirement that a participant could not be in receipt of any other contracted provision, for example through the Work and Health Programme. This meant a number of disabled people were not able to access this programme. However, the combination of subsidised work experience, alongside other support, is the ideal combination for helping those who have not been able to enter the workforce previously to do so. Disability employment is lower in every age group than youth employment – extending the same support to disabled people of all age groups would be extremely beneficial to disabled people.

DWP’s Employers, Health and Inclusive Employment team and the Government Equalities Office should scrutinise impact assessments’ analyses of the impact on disability employment of significant policy developments. A renewed focus on proper impact assessments would address the lack of awareness of disability employment, and the need to ensure it is properly taken into account.

The UK Government should make improving disability employment a cross-cutting outcome in the Treasury’s outcome metrics, to increase institutional focus beyond simply DWP.  As it stands, there is a DWP outcome to “improve opportunities for all through work, including groups that are currently underrepresented in the workforce”, which is measured by a metric on the “disability employment rate gap”, but this is not chosen as one of the Government’s cross-cutting, multi-department, outcome metrics. Contributing departments should include BEIS, the Department of Health and Social Care, the Department for Education, the Department for Levelling Up, Housing and Communities, and the Treasury. This would help generate institutional focus on increasing disability employment beyond simply DWP. The introduction of the Work and Health Unit, and now the Employers, Health and Inclusive Employment policy group, has helped generate much more rigorous focus on this work, but silos still remain across Government as a whole.

Boosting disability youth employment

Young disabled people have some of the lowest levels of employment of anyone in the UK, at 37 per cent in 2019. They are disadvantaged in the labour market because of both their age and their disability.

We had a young deaf person undertake work experience with us. It was a great experience for all of us. A lot of our work is done as part of a group. We expressed our ideas through drawings and architectural visualisations. We were able to explore a different side of explaining our work. She helped us more than we helped her.

Saira Hussain, Construction, Manchester 

Key recommendations:

DWP should roll out Access to Work (AtW) passports immediately following the pilots to aid all young people and other groups such as ex-service personnel who are disabled or who have a health condition in transitioning from education to employment. After this has taken place, DWP should roll out AtW passports to the wider population. Progression in work will often involve leaving one job to work at another. Helping ensure that disabled people can do this without unnecessary friction, or disruption to the important first months of employment in a new workplace, is important for ensuring this happens successfully. Should the pilots prove unsuccessful, DWP should consult on an alternative to improve the employment prospects for disabled young people.

The Department for Education (DfE) should join up careers advice and guidance with disability support and guidance so that education leavers know how to access assistive technology and support to enable their transition into employment. 

DfE should reintroduce the principle of compulsory work experience to support young people to have an early, positive introduction to the workplace. Work experience is incredibly important to give young people an early introduction to the workplace and to develop important soft skills. The end of compulsory work experience in England in 2012 for students at Key Stage 4 was arguably detrimental to the employability of young people and the education-to-employment transition. It is likely that access to quality work experience is restricted for young disabled people, so a focus on promoting the programme and supporting them to access high quality work experience is essential. If the principle of compulsory work experience cannot be introduced, at the very least statutory guidance to schools and colleges should be revised to include a “right to be offered” a substantive work experience placement at Key Stage 4.

Access to Work and Disability Confident

Key findings: 
  • 45 per cent of small business employers are aware of Access to Work, but only five per cent have used it.
  • 42 per cent of those who know about Access to Work think it is important.
  • 23 per cent have heard of Disability Confident.
  • 34 per cent of those who know about the Disability Confident scheme understand it, and 28 per cent think it is important.

We have used it before, and they were really good. They paid for a flashing fire alarm and typists among other things. We’ve had positive experiences with them.

FSB member, Social enterprise, Wales

Key recommendations:

DWP should move cost sharing in Access to Work to six weeks after disclosure, rather than six weeks after employment. Employers may have to share the cost with Access to Work if the person has
been working for them for more than six weeks when they apply for Access to Work. However, many disabled employees can be initially reluctant to disclose a disability until they are more comfortable in their working environment. Changing cost sharing to six weeks from the point of disclosure will help smooth the process of an employee already in work disclosing, including if that disclosure takes place in the context of performance management or disciplinary processes.

DWP should amend the Access to Work scheme so the default is that the equipment sits with the employee, rather than the employer, meaning that the employee can easily take it between roles. Moving equipment to sit with the employee would remove the need for the employee to go through the process with a new employer. It is both more administratively efficient and would also mean employees can start new roles with the equipment they need.

DWP should introduce a ‘small business outstanding performer’ tier to Disability Confident for those small businesses producing good outcomes. Currently, the scheme disadvantages small businesses
by being too focused on procedures and not outcomes, which disadvantages smaller businesses who may already be outperforming larger ones in terms of employing people with disabilities. This should be accompanied by a new tier 4 for those large businesses which are helping support disabled people in their wider supply chains. Support for supply chains was part of the enhanced standards for organisations employing more than 500 people in the Stevenson Farmer Review.

The Disability Unit’s forthcoming UK-wide campaign should include a focus on improving the attitudes of colleagues to their disabled co-workers and increasing awareness of Access to Work, including for the self-employed. 

Managing sickness absence

Key findings: 
  • The total cost of sickness for small businesses in the last year was £5 billion.
  • 50 per cent of small employerswho employ a disabled person or someone with a health condition have adjusted the working hours or shift patterns for an employee.
  • 19 per cent have provided specialist equipment, and 15 per cent have made their workplace more accessible.
  • 35 per cent have implemented a phased return to work.
  • 54 per cent of small business employers believe the Government should cover SSP costs or implement a full rebate for small businesses.

Employing people is becoming prohibitively expensive in an industry that can’t really function without people.

FSB member, Hospitality, Scotland

Our recommendations:

The UK Government should introduce a permanent Statutory Sick Pay rebate for small and medium-sized enterprises. FSB recommends Government provides a full rebate to small firms. This could be modelled in the same way as the SMP Small Employers Relief (excluding higher earners) to support SMEs deal with the costs associated with long-term sickness absence. A rebate must accompany any changes to the SSP system that will increase the cost – for example expanding eligibility to those earning below the LEL – in order not to disadvantage those firms who are disproportionally employing disabled people.

DWP should prompt GPs (or other health professionals) writing fit notes to include a recommendation to use Access to Work. Prompting GPs to consider highlighting Access to Work will help increase awareness of the scheme at one of the most crucial points in time for an individual employee’s retention.

DWP should amend the fit note process to permit a wider range of medical professionals to write and certify fit notes, to allow for more detailed specialist information and to free up GP time. As indicated in the Government’s response to the Health is everyone’s business consultation,44 to allow for more detailed specialist information and to free up GP time. Employers may struggle to interpret fit notes, therefore it may be advisable to provide information on fit notes such as which work tasks an employee is fit, and not fit, to undertake.

DHSC should increase the number of outpatient appointments booked through the NHS e-Referral Service (previously Choose and Book). Healthcare which is delivered around the person and their working life is more successful. The NHS should embrace digital adoption which worked successfully during the pandemic to resolve difficulties in booking non-urgent healthcare.

Occupational health

Key findings:
  • 28 per cent of small employers provide occupational health (OH) services to their staff, up from 10 per cent in 2018.
  • Reasons for not using OH services include not having any current staff health issues (44%), not knowing enough about OH services (25%), and thinking it is not relevant for their business (18%).
  • 44 per cent would be encouraged to use OH services if they received Government financial support for them. 35 per cent could be encouraged with additional information, and 31 per cent would be encouraged by a specialist service aimed at small businesses. 

Occupational health is our go-to thing as it’s a bit more formal and we find that that helps.

FSB member, Charity, Cumbria

Our recommendations:

HMRC should eliminate the perceived tax risks of enabling small suppliers to access employee assistance programmes. Large businesses with complex supply chains are often well-placed to help their smaller suppliers access employee assistance and other health programmes – not least when they already supply these for their own workers. There is no lack of willing among many firms, but there is a concern that by doing so they could be creating a tax risk or a legal employment relationship. This concern is likely to be unfounded, but to ensure this does not prevent positive supply chain efforts, HMRC should make clear that this activity will not create a tax risk.

DWP should publish the findings from its testing and evaluation of the subsidy for SMEs and the self-employed within the next six months, and implement a subsidy within 24 months. The Government has committed to testing and evaluating an occupational health subsidy for the self-employed and small businesses, following the work of the Occupational Health Expert Working Group. The Government accepts and advocates the need for greater access to occupational health among these groups, so should implement these commitments without delay.

Innovate UK should support occupational health disruptors, especially those which specialise in the small business market. Large organisations with a higher number of employees are often the focus for OH businesses, even though some smaller OH providers specialise in working with small businesses. There is a gap in the market for a specific service aimed at small businesses that might need less frequent support, and the Government should consider supporting disrupters in this market through Innovate UK.

50-plus workers

For workers over 50, ill health, and disability are not synonymous. However, health is known to be a significant reason as to why workers aged 50-64 leave the labour market early, as the prevalence of long-term health conditions and disability increases with age. The TUC reports that one in eight workers will leave the workforce before retirement age due to ill health or disability. 

Key recommendation:

The UK Government (England) should implement the 50-plus choices employer taskforce recommendation for the Department of Health and Social Care and NHS-led implementation of a more holistic view of the menopause transition by clinicians in England. This more holistic view would focus not only on the immediate clinical response, but would also encompass mental health and long-term wellbeing. This should also be expanded to include a specific focus on the impact the menopause has on work.

Download the full report

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