..."The employment rate has remained resilient. However, since the financial crisis we have seen the rise of “underemployment” – where people have jobs but not for as many hours as they would like. Zero-hours contracts probably played a role in encouraging this trend. If zero-hours contracts were just a response to the downturn, though, we would expect them to decline as the economy recovers and employers start to compete more for workers. This may happen but I suspect that they are here to stay. This is because the contracts’ rise has a deeper cause. From what we know, most of the zero-hours contracts are in the part of the UK economy that has plagued policy makers looking at how to revive average living standards. Social care, retail, hotels and restaurants – which account for hundreds of thousands of zero-hours contracts – are generally sectors that are low skilled, not subject to international competition and where employers compete primarily on cost. Productivity is low, and so are wages. Unions are either absent or weak. For many companies, zero-hours contracts are a logical extension of the business model.
Posted on: Wed, 07 Aug 2013 04:20:09 +0000
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