Breadline Blues
Why micro-businesses are a blessing and a curse for marginalised people.
A personal polemic.
Background.
Here in the UK, and elsewhere, the right wing political class and many on the left are culturally and economically wedded to the idea of the deserving and undeserving poor. Often situated in leafy suburbs or smart town houses, the comfortable middle classes are often so far removed from the experiences of the poor that they refuse to see, or understand, how precarious are the existences of marginalised people.
Politically, the well-to-do tend to vote for the status quo; austerity budgets designed to enrich big business and the wealthy, inequality politics that continue to funnel wealth and assets from the poor to the rich, levels of benefits for marginalised people that keep people in perpetual poverty and employment practices that discourage and prevent those in need from staying in work or even seeking work.
The refusal to see how marginalised people are, in reality, marginalised is partly due to the discomfort of the task, partly intellectual laziness and partly due to hegemonic ideas of how ‘drive and determination’ will always lead to a good outcome for individuals sensible enough to undertake a few basic ‘fundamentals’ such as working hard and turning up on time.
Yet there are mountains of evidence to show that, in a society wedded to competition and only rewarding winners, there will inevitably be a vast underclass whom, due to no fault of their own, live a highly precarious existence. For the marginalised, even those from relatively secure backgrounds, days of hardship turn into weeks, years and decades of struggle. Their credit ratings mean that loans, if available at all, are at crippling interest rates. For the poor, everything is, like for like, much more expensive. Food, energy, transport, healthcare, housing and so-on. Once poor, there are very, very few opportunities to drag oneself up from the mire. It is true that many do manage to vastly improve their situation by hard work and perseverance, but there are many more people who apply the same determination and fail because our political and economic systems only have room for a limited number of winners, by design. On top of that, there are many who succeed by sheer luck and, if they do, they often attribute their success to levels of skill and judgement that is, in fact, no better than average – oh to have the confidence of a healthy white man – so the saying goes.
After years or decades of hardship, the marginalised become unemployable. Poverty makes people ill. Illness and poverty cloud one’s judgement through stress and anxiety. Over time, people with such ‘worn’ psyches become unable to function normally and/or are constantly on the edge of mental breakdown and depression – thus further marginalising them. The evidence for this is overwhelming.
There are millions in that situation here in the UK and hundreds of millions of us around the world. The poor are counted in billions. For some, the only way out of that morass of humiliation is to become self-employed. Starting, and usually staying, as micro-businesses. From cleaning windows to caring for the elderly, from jobbing mechanics to all number of trades, crafts and services, there are about 4.8 million sole traders in the UK alone and while a few lead successful middle class lives, most do not.
“There are around 4.8 million self-employed people currently working in the UK, nearly 80% of whom live in poverty, according to Tax Research UK.”
Levels of success are very low. According to the IFS, 20% of sole traders go under in their first year while the majority fail within five years. Why is this?
In part it’s because so many people are competing for a limited amount of work, or have to charge fees that are undercut by corporate interests paying poverty wages. In part it is also due to the fact that the poor are in worse health, live more precariously and are often already saddled with debt. One of the biggest hurdles is ‘under-capitalisation’. For regular businesses that phrase means what it says; starting capital is insufficient and savings/contingency funds are too low to weather inevitable storms and breaks in income. For most micro-businesses, any form of capitalisation is a distant dream. Most start with nothing or less than nothing and live hand to mouth; income from one weeks work pays the bills for that week only and might, just might, pay for the opportunity to go to work the following week. There’s no capital, no contingency, no access to credit, no plan B.
My experiences of being marginalised.
Though I came from a comfortable middle-class background, financed by my white working-class-made-good grandfather, I didn’t have money of my own and, just like working class lads, paid rent to my parents from holiday work and had to borrow to attend interviews when I entered the world of work. However, I was already marginalised due to my Anglo-Thai ethnicity; criticism of my ‘genetic disadvantage’ from my family, severe bullying when at school, including being shot by Cadets when swimming in a river. Finding places to live in London in the early 1970s was fraught, many lodgings advertising ‘no Blacks, no Irish and no dogs’. Those racists were not discerning; as a light-skinned ‘half-cast’ S. E. Asian I had doors slammed in my face just the same.
Later in life I was treated very differently by employers too. Often not being considered for interviews, being passed over for promotion by younger, less qualified white people that I had trained. I was also given warnings by employers that I was too successful, attracting more press reports than my bosses. In short, in spite of experience, qualifications, doing my job well and taking my work seriously, I was always considered to be somehow ‘not right’. It might not have helped that when in work I’d call out the racism, sexism and homophobia that was so ubiquitous, and is now on the rise again, in the 70s, 80s and 90s.
Like so many marginalised people, It was only much later in life that I realised that my experiences were very common and that white people’s odd and often violent reactions to me were not due to defects in my character but due to the personal and structural prejudices of the society in which I found myself. Another thing I found was that the world of work, in many industries and sectors,is highly networked; one’s reputation as an uppity trouble-making ‘wog’ proceeds one through life via formal (now illegal) and informal ‘black-lists’.
Many marginalised people are thus forced to change their areas of work and expertise many times in their lives. We end up starting from the bottom over and over again only to be thwarted, particularly if we are good at out jobs. We are also often over-qualified. I have an averagely good degree in design, spent several years as a designer and copywriter for theatre and advertising. I am a qualified car mechanic and welder and worked for several years as a car mechanic. I have a first class science degree and worked on and off for 20 years as an employed and self employed environmental consultant. I have a number of City and Guilds qualifications too. 10 of those years were at Watford Council where I was again constantly undermined by senior staff who gave me serious warnings about not having the ‘right attitude’, in spite of out-performing the targets they themselves has set, and in spite of leading several environmental programmes that were then rolled out across the whole of the UK.
While all that was going on, my mother died in the 90s and it transpired that, when they moved to Spain, she and her second husband had stolen all the family money that my grandfather had left in trust for me and my sister. I didn’t care about the money but I did care about the betrayal. I spent two years, with no income, attempting to right those wrongs and save the family company. I used up all of my own money, went through a divorce and, again, had to start from scratch.
After being forced out of my job as a Senior Environmental Consultant at the Groundwork Trust in Plymouth by the CEO, convicted fraudster Jon Andrewes, in 2002/3, I gave up on environmental work altogether. Had I known at the time he was a liar and a fraud I would have stayed on and fought my case. But he successfully gas-lighted and tricked me, and other colleagues, into thinking my calculations and opinions were at fault and I had a fairly major nervous breakdown. It’s no surprise that the only other person of colour in the organisation at the time was also gas-lit severely.
Of course, my customers, employers and line managers have always been white and they often expected way more from me than my white counterparts. Not only that, many were often severely miffed if my work was ever praised or varied from their own opinions – such praise rarely sat well with them.
After that I was self-employed as, variously, a labourer, gardener, builder, handy man, car mechanic and woodlands manager. But in 2006/7, rumours went around the town (Ashburton in Devon) that I was a terrorist sympathiser because of my vocal opposition to the Iraq War in 2003. My work evaporated and the HMRC erroneously accused me of stealing over £8k in Tax Credits and I went bankrupt and became homeless. I was re-housed in Buckfastleigh in 2007. At my Bankruptcy Hearing the judge, who had all the evidence and information, told me that none of my financial troubles were my own fault and imposed the minimum time for discharging the bankruptcy; 6 months.
However, banks and other institutions still consider one a liability for 6 years so I had no access to regular borrowing rates until 2013. But the problems did not end there. When labouring I was attacked by other labourers. I was subjected to monkey chants, run off the road by their lorry and refused access to materials. Farm workers surrounded me with dogs and discharged their shot guns above my head.
In 2014 I had a chance to start over. My then girlfriend’s, mother, who loved driving, wanted to help me start a small business. Nagara Automotive was set up, to re-engineer the classic MG Midget. When my relationship ended, my investor said she would continue to fund the start-up. However, soon after that she died and the project was stalled. But Nagara Automotive still survives as a micro-business here in Devon. The MG project is pretty much dead in the water but work on customer’s classic cars continues, albeit at a slow pace.
In addition to issues with employment and racism, there were also issues concerning my health and racism. My white parents and family, my school and medical professionals, all ignored the pains I had in my childhood, claiming I was making a fuss typical of my ‘race’and put me on barbiturates to ‘calm my nerves’. A serious condition was missed and not diagnosed until the 1990s. An operation was botched and I ended up in a specialist hospital at Harefield that also made several mistakes, as a result, my then wife and daughter were called in to say goodbye; According to another surviving patient, 10 of the 12 men on my ward died of the infection that ran through the hospital. Of course, that was just luck. But, had my original condition been evaluated previously, I would not have been there in the first place. My mental health too was fragile and many therapists completely dismissed my experiences of racism as ‘worrying about nothing’ or saying my concerns were for things that were ‘highly unlikely’, I was part of the ‘worried well’ as one therapist at the Maudsley Hospital remarked. As most people of colour know, experiences of racism are not unlikely, they are a certainty.
Micro-businesses and the Marginalised
People start micro-businesses, or become self employed for many reasons but for marginalised people it is often the only means of earning a bit of money or remaining gainfully occupied. People are marginalised for many reasons; racism, ableism, homophobia, sexism, transphobia and many other issues. Some people have layers of marginalisation where more than one identity intersects – often such identities are foisted upon people whether they like it or not.
Micro-businesses offer a life-line. Sometimes the life-line is purely financial but more often it’s merely a better alternative to living wholly on benefits or living on the streets.
Micro-businesses can offer: hours one can choose oneself; an escape from bosses that might overtly or secretly undermine your work and prospects; the ability to do work that one actually likes; and a chance to become part of the community by offering a much needed service. Making money and entrepreneurship are often secondary issues or perhaps icing on the very small cake. Not because those aspects of life are unimportant to marginalised people but because many marginalised people see survival as the goal, having come so close, so many times, to not surviving.
But starting a micro-business from nothing is extraordinarily difficult. Nothing actually means nothing; no capital, no premises, no equipment and often historical debt too. For people in reasonable health and with no other issues, its hard enough. For marginalised people, it’s almost impossible. Yet some of us had help. In my case it was an investor ‘angel’ who knew me personally. But once the initial, insufficient, capital was gone I needed to use credit cards to make up the shortfall.
Things ticked along fairly well for a few years. I was breaking even plus a bit more, paying my debts and drawing out small amounts of money to supplement my benefits – at the time I received Disability Living Allowance, Tax Credits and some Housing Benefit. That might seem unfair to people who have always worked and receive no benefits at all, yet our micro-business turn-over adds to the economy, provides a service and keeps us in a better physical and mental state that, otherwise, would be an even greater burden on society. Over the years, benefits were cut, DLA vanished, the ‘Bedroom Tax’ was introduced, the ‘Minimum Income Floor’ was introduced and micro-businesses run by marginalised people were severely affected. Then Covid happened. Covid changed everything.
The self-employed were very poorly served by the economic response to Covid. Like many marginalised people in business, we often work out of semi-official premises; rented rooms, sheds and workshops not registered for Business Rates with the Local Authority, so we were not eligible for the flat £10k premises grant. Our income is always uncertain and variable but our profits are even more variable. Instead of helping self-employed people with a grant that mirrored a percentage of our turnover (and thus our expenses) we were offered a percentage of our profits, averaged over 3 years. For huge numbers of people who might have lost money one year and made money the next, the government support over the Covid period amounted to almost nothing.
We were also encouraged by lenders and banks to open a business account to take advantage of other government help. Even though the regulations stipulated that such loans must not be contingent upon opening a new account, the banks ignored that, without censure, and so we started to pay banking fees to access loans that served to keep food on the table but not much else. Even though as sole traders we are individuals, not firms, government treated us as if were were tiny corporations rather than people struggling to survive.
Covid also hit our customers and a lot of work dried up or became too infrequent. And as if that were not enough, many sole traders, particularly in the food industry, have been forced out of business by Brexit. During Covid I was forced to borrow more than I could afford on the basis that things would pick-up more rapidly than they did. It was a mistake and the borrowing was stupidly expensive because of my poor credit history. In 2022 I realised I could not, again, service my debts and entered into an IVA. Not a 2nd bankruptcy but almost. I’m not allowed to borrow.
Government has also further marginalised people by their ‘War On The Woke’, by undermining all the agencies and organisations set up to help those in need. They claim that such organisations are somehow ‘Culturally Marxist Enclaves’. Ironically, those same far-right forces claim that the biggest ‘socialist’ country, China, is undermining the ‘West’ by being too successful at business. Marginalised people in the micro-business sector are painted as Schroedinger’s entrepreneurs; valiant individuals striving to better themselves by their own efforts and, simultaneously, woke communists opposed to free enterprise.
Being self employed and running a micro business is both a blessing and a curse.
Cash-flow.
For all self employed trades people cash-flow is everything, poor cash-flow will cripple even healthy, profitable businesses. For marginalised people it is even worse. With little or no cheap credit available, probably no assets and an already precarious existence, even tiny upsets can be fatal. The income from customers’ one day, or week, finances the work for the following day or week. Yet customers, even when this is explained to them, continue to pay late, delay payments or sometimes even refuse to pay. This is endemic in many trades. I’ve been very lucky in that I invoice my customers the Friday or Saturday after the work is done and most are happy to pay on time, the same day or within a couple of days.
But if I work for a week or more and then don’t get paid, it’s a disaster. Not enough petrol to get to work, little or no food in the fridge and, on one occasion, sitting in the dark with no electricity at home all weekend because my key-meter had run out. In winter that’s a double disaster as everything in the flat is electric. So a late payment doesn’t just prevent carrying out work for the late-paying customer, it stops everything, so adding to anxiety, sleeplessness, ill health and so-on.
Micro-businesses are a blessing and a curse for the marginalised self-employed. It’s often noted that we’d be better off stacking shelves in a shop. That’s true. But many, many marginalised people with health problems are not able to predict when their illness will strike. In my case I have several health issues that mean I can’t predict, day to day, if I’m going to be fit for work. Sometimes I get to work and after an hour I’m too ill to continue. Sometimes the day goes brilliantly. Some weeks I can’t work at all while other weeks I find I’m able. Mostly it’s a mixture. Like so many around the world and in the UK, I live day-to-day, hand to mouth and unpredictably. I’m very lucky I have a roof over my head and I’m not living rough in total poverty. But from experience I know that absolute poverty is always just a bad month away.
Thank you for reading this.
If you are a customer of a micro-business or a self employed person, always pay your bills immediately.
Nagara 