How zero-hours contracts hide real unemployment

If you're on contract without work, the ONS can count you as employed.

The CBI and Institute of Directors have both waded into the debate over zero-hour contracts, arguing that tenuous labour is a necessary tool in the fight against unemployment. The Financial Times' Elizabeth Rigby, Duncan Robinson and Andrea Felsted report:

John Cridland, director-general of the business lobby, said those complaining about such contracts needed a “reality check”…

“These contracts play a vital role as a way of keeping people in employment,” said the head of the employers’ body. “If we hadn’t had this flexible working when the economy contracted, unemployment would have topped 3m – and it didn’t it went to 2.5m.”

Cridland may or may not be correct (the actual numbers do not appear to be based on any research, but even numbers pulled out of thin air may be correct through chance), but somewhat misses the point.

People on zero-hours contracts may count as employed even while, for all functional purposes, they have no job. When the ONS is counting employment, anyone who has a currently active zero-hours contract counts as "employed", even if they haven't taken a single shift in the week of the survey. And given the anecdotal evidence that employers frequently stop giving employees work as a way of effectively firing them, many of those employees actually are unemployed, then just haven't been told yet (official statistics on the practice don't exist for obvious reasons). Dawn Foster details the sort of stories which are common:

One colleague was slightly late two weeks in a row, and when asked why replied she’d had trouble finding a parking space. She didn’t come in the following week. Looking at the month’s rota I saw her name but with no shifts allocated. Two months later I saw her near my house. “Have you got a new job?" I asked. She explained she hadn’t, and that while she’d not been sacked, she hadn’t been offered any shifts and there’d been no explanation.

The ONS explains how they measure zero-hour workers who may be in that trap:

People who are on zero hours contracts count as employed. If they worked at least an hour in the survey reference period they would be counted in the employment numbers as usual. If a survey respondent did not in fact work in the reference period, the first question asked is whether they are 'temporarily away from a job' (they could be sick or on leave, etc..). Those on a zero-hours contract should reply to say they have a job to return to. In this instance they would be in employment but listed as having worked no hours

In other words, there are people who are not currently receiving work from an employer, and who will never again receive work from that employer, but who still count as "employed" in national statistics because their employer sees no need to officially fire them. This has additional implications for their lives. Some zero-hour contracts include rules banning the employee from taking work for other employers at the same time, while those who end up "voluntarily" leaving work are unable to claim many out-of-work benefits.

The effect of this on employment statistics is hard to measure, particularly since it is widely believed that employment statistics already fail to capture the full effect of zero-hours employment. The latest figures from the ONS show just over 200,000 people on the contracts, but the FT reports that "research released this week by the Chartered Institute of Personnel and Development claimed there were about 1m zero-hours workers in the UK". Regardless of the total, however, one thing is clear: for some people, the difference between a zero-hour contract and unemployment is negligible.

McDonalds is one of the firms at the centre of the zero-hour contract row. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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The NHS's sustainability is under threat if more isn't done to look after its staff

More work is needed to develop the health service's most precious resource.

As the NHS nears its 70th anniversary, the time is ripe for a workforce rescue plan. Staffing worries, even more than funding pressures, are the biggest cause of concern for NHS trust leaders. There are not enough trained health workers in the UK to meet today’s needs, let alone those of the future.

Demands on hospitals, mental health and community trusts, and ambulance services are growing. More patients need treatment. Increasingly, they require complex care, with specialist expertise. This is not just about numbers. We need a clinical workforce that is skilled and equipped to work in new ways to deal with the changing needs of the population it serves. 

That means improving the supply of people coming to work for the NHS, and doing more to develop and motivate them so they want to stay. These problems are not new but the scale of the challenge has reached a tipping point which threatens the future sustainability of the NHS.

Ministers rightly point out that the NHS in England has more clinical staff than ever before, but numbers have not kept pace with rising demand. The official "shortfall rate" for nurses and midwives across England is close to 10 per cent, and in some places significantly higher. Part of this is down to the recognition, after the events at troubled health trust Mid Staffordshire, of the importance of safe staffing levels. Yet for successive years during the coalition government, the number of nurse training recruits fell.

Far from being a problem just for hospitals, there are major nursing shortages in mental health and community trusts. Between 2009 and 2016 the number of district nurses employed by the NHS in England fell by more than 40 per cent. Just as the health service tries to accelerate plans for more treatment closer to home, in key parts of the workforce the necessary resources are shrinking.

There are also worrying gaps in the supply of doctors. Even as the NHS gears up for what may prove to be its toughest winter yet, we see worrying shortfalls in A&E consultants. The health service is rightly committed to putting mental health on an equal footing with physical health. But many trusts are struggling to fill psychiatry posts. And we do not have enough GPs.

A key part of the problem is retention. Since 2010/11 there has been a worrying rise in “leaver rates” among nurses, midwives, ambulance staff and scientific technical staff. Many blame the pressures of workload, low staffing levels and disillusionment with the quality of care. Seventy per cent of NHS staff stay on for extra hours. Well over a third say they have felt unwell in the past year because of work-related stress.

Add in cuts to real basic pay, year after year, and it is hardly surprising that some are looking to other opportunities and careers outside the public sector. We need a strategy to end pay restraint in the NHS.

There is also a worrying demographic challenge. Almost one in three qualified nurses, midwives and health visitors is aged 50 or older. One in five GPs is at least 55. We have to give them reasons to stay.

NHS trusts have made important strides in engaging with their workforce. Staff ratings on being able to report concerns, feeling trusted to do their jobs, and being able to suggest improvements are encouraging. But there are still cultural problems – for example around discrimination and bullying – which must be addressed locally and nationally.

The NHS can no longer be sure that overseas recruits will step in to fill workforce gaps. In the early 2000s many trusts looked beyond Europe to meet nursing shortages. More recently, as tougher immigration and language rules took hold, a growing proportion came from the EU – though not enough to plug the gap.

Now we have all the uncertainty surrounding Brexit. We need urgent clarity on the status of current EU nationals working in the health and care systems. And we must recognise that for the foreseeable future, NHS trusts will need support to recruit and retain staff from overseas. The government says it will improve the home-grown supply, but that will clearly take time.

These problems have developed in plain sight. But leadership on this has been muddled or trumped by worries over funding. Responsibility for NHS workforce strategy is disjointed. We need a co-ordinated, realistic, long-term strategy to ensure that frontline organisations have the right number of staff with the right skills in the right place to deliver high quality care.

We must act now. This year's long-delayed workforce plan – to be published soon by Health Education England – could be a good place to start. But what we need is a more fundamental approach – with a clear vision of how the NHS must develop its workforce to meet these challenges, and a commitment to make it happen. 

Saffron Cordery is the director of policy and strategy at NHS Providers