A decline in the number of self-employed people since the pandemic could damage entrepreneurship and worsen supply shortages in the wider economy, according to experts.

The number of self-employed workers has shrunk by nearly a fifth since late 2019, according to figures from the Office for National Statistics.

Self-employment reached a high of more than five million at the end of 2019, but since then nearly 800,000 people have left to take up salaried jobs, study, train or leave work altogether, reports The Times.

More than a million self-employed people were not eligible for the support scheme offered by the government during the pandemic and many had to leave self-employment after changes in tax rules.

The rewards for those who remained self-employed have also shrunk. Typically, they are earning less than they did before the pandemic, according to a survey by the London School of Economics' Centre for Economic Performance.

The Times quoted Andrew Chamberlain, director of policy at the Association of Independent Professionals and the Self-Employed, as saying that businesses "like having full-time staff, but they also like having the more ad hoc, more flexible resource coming in to complement that as well.

"If you don't have that thriving pool of self-employed people out there, that is going to have a negative impact on what those businesses can do.

"You can join up the dots and say that overall this is going to have a negative impact on our economy if the self-employed market shrinks."