CIPD Voice: Issue 32


A new report from the CIPD asks is work becoming less secure? The answer is no. Work has actually become more secure over the past decade.
 
Defining security

The report finds that some of the language around insecurity is unhelpful. The terms atypical and non-standard are often used but they describe work that is pretty typical and pretty standard. Part-time working and home-working are key examples. The idea of what is ‘typical’ is old-fashioned and reflects a bygone labour market dominated by male full-time employees attending a physical workplace. The report instead focused on non-permanent work (including non-permanent employees and the self-employed). It finds that the proportion of people in non-permanent work has reduced slightly from 19.2% in 2010 to 18.6% in 2021.
 
The report then went on to look at job security, hours security, and pay security. 
 
Job security

Job security includes the ease of getting and keeping a job. Despite a blip during the pandemic, the labour market is fast starting to resemble the pre-pandemic era of low unemployment. The jobs boom of the past decade led to a tight labour market, which decreased unemployment, long-term unemployment, and those classed as inactive but would like to work. Workers were less likely to be made redundant, and those searching for jobs faced less competition. The ratio of unemployed to available vacancies is currently at a record low. Consequently, there has been a rise in the number of temporary workers as employers rely on them to help match increased demand as the economy reopens.
 
Hours security

The report finds a reduction in the proportion of the workforce whose hours vary. It also finds that there are now less people working part-time because they could not find a full-time job. There are also now less people who would like more hours. Metrics like this show that more people are getting the terms that they want from work. When it comes to the frequency with which workers face unforeseen demands, it is the higher-paid managerial and professional roles that are most affected.
 
Pay security

The report finds that increases in the minimum wage have reduced the proportion of workers in low paid jobs (defined as earning less than 60% of median wages). The report also finds a reduction in the proportion of workers whose pay varies and that over the years, overtime payments, incentive payments and shift premia are representing a smaller proportion of people’s pay packets. 
 
Do people choose atypical employment?

Regular surveying finds that 43.6% of self-employed workers work in this way for better work conditions or job satisfaction. Around a third (31.2%) do it to maintain or increase their income. Just 7.6% are self-employed because they could not find regular employment. On balance, the reasons given for self-employment are overwhelmingly positive.
 
A discussion on work insecurity in the UK would not be complete without a closer look at zero-hours contracts. The report finds that almost two-thirds (64.5%) of people on zero-hours contracts have a permanent role and so are likely to have full employment rights, subject to length of service. The vast majority (84.6%) of people on zero-hours contracts are not looking for a new job; 11.5% of people are looking for a new job and 3.9% are looking for an additional job. The majority of those on zero-hours contracts (75.5%) do not want more hours.
 
The report concludes that choice should be at the heart of discussions about different ways of working. One person’s insecurity is another person’s flexibility and having a diverse range of working options available helps people to find work that matches their preferences.
 
Does the report miss anything out?
 
Absolutely. The report concludes that work is becoming more secure. The labour market is important because it is the primary means through which resources are allocated. However, other factors are also important. Benefits and the cost of living also play a large role and changes to these will affect a person’s perception of security. Approximately, a third of employees have their incomes topped up by Universal Credit, for example. Housing and childcare costs are also considerable drains on disposable incomes. These factors are significant and perhaps pivotal in people’s perception of increasing insecurity but beyond the scope of this report.
 
The CIPD’s report also drew on publicly available data, mainly the labour force survey and so it was not able to look closely at the gig economy. Coincidentally, a week after the report was published the Social Market Foundation released a report based on a survey of gig workers. This report reached similar conclusions noting that most gig workers are happy and in work that suits their preferences. 
 
Although the CIPD’s report finds that work is becoming more secure, that does not mean that the level of security in the labour market is where we want it to be. The report finds substantial pockets of insecurity with some groups more affected than others. It suggests that to tackle this we need better enforcement of existing legislation and a focus on skills and progression.
Jon Boys

Jon Boys: Labour Market Economist

Jon joined the CIPD in January 2019 as an Economist. He is an experienced labour market analyst with expertise in pay and conditions, education and skills, and productivity.

Jon primarily uses quantitative techniques to uncover insights in labour market data, both publicly available and generated through in house surveying. Jon regularly contributes commentary and analysis of economic issues on the world of work to online, print and TV media. Recent work includes the creation of an international ranking of work quality, analysis of firm level gender pay gap reporting data, and an ongoing programme of work looking at the changing age profile of the UK workforce. 

Prior to this he worked for Be the Business – a government backed start up aimed at increasing firm level productivity in the UK, the Careers & Enterprise Company – another government backed start up aimed at transforming careers provision in school. He has also held prominent research roles at an Employers Association and Trade Union researching pay, conditions, and workforce composition. 


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