Coronavirus crisis: Self-employed at risk of poverty due to lost income

The coronavirus crisis could mean poverty for many self employed and their families, according to calculations by Statistics Netherlands. 19 percent of self-employed people's household income will be below the minimum wage limit if the self-employed person had no income for three months. After a year of no income, a third of self-employed and their households will be staring at the poverty line.

The stats office used data from the 2018 Integral Income and Equity System for these calculation. For each simulated loss of monthly income, the researchers calculated whether the household resources that were still available fell below the minimum wage level. "The remaining resources are any other gross income sources of the self-employed person (such as additional income as an employee or pension income), any gross income from other members of the household, and the freely absorbable assets of the household."

Of the over 1.26 million self-employed persons in the Netherlands in 2018, 0.7 percent of associated households were already below the minimum wage line. With one month of lost income, 11 percent of all self-employed would be below that line. This percentage increases as months of no income increase, to 35 percent after 12 months of no income.

Self-employed persons in The Hauge have the least financial buffers - after 12 months of no income, 52 percent of self-employed in the city would be below the minimum wage line. This percentage is also high in Rotterdam, Schiedam, and Vlaardingen, as well as in Heerlen, Kerkrade and Vaals and on the Wadden Islands. Self-employed in Bloemendaal and Rozendaal are best able to absorb financial blows, with only 21 percent below the minimum wage line after 12 months of no income.