In recent years, the UK has celebrated historically low unemployment rates, with the latest Office for National Statistics figures reporting over a million job vacancies across the country, and three in four Brits (75 per cent) of working age now in some form of employment.
Yet, behind these seemingly good figures is a more complicated, damaging labour challenge: severe insecure work.
Recent research from the Work Foundation at Lancaster University estimates that 6.2 million people in the UK are now in what can be defined as “severely insecure jobs”, for exmaple, low pay, temporary or part-time roles with contractual insecurity and very limited access to workers’ rights.
A new report from the Work Foundation, in partnership with my organisation – the Chartered Management Institute – finds that many of those in insecure work want more security, which is to say: worried about losing their job, and don’t feel they can influence change.
Our analysis also shows that the scourge of insecure work hits some harder than others. Structural inequality in the labour market means that women, young people, ethnic minority workers, and disabled workers are disproportionately more likely to be in an insecure job, with these workers often feeling the need to compromise job security to get work that offers the flexibility they need. That’s particularly true for jobs in the “everyday economy”, in sectors such as retail, care and hospitality. To improve conditions, we need an approach that addresses the challenges in each sector, rather than one grounded solely in overall employment law, as important as that is.
This isn’t just a setback for workers, it’s a central problem for businesses and the wider economy, as we continue to waste talent – just when we need it most.
When employees feel uncertain and undervalued, their performance inevitably suffers, putting any organisation’s overall productivity and performance at risk. A recent CMI survey of more than 1,000 managers finds that three out of four (75 per cent) are seeing signs of stress and anxiety in their workplace linked to the cost-of-living crisis and their staff’s money concerns. Of those who reported seeing evidence of stress or anxiety, the vast majority (93 per cent) said it was affecting productivity, with managers pointing to a lack of attention to detail, distracted team members, and people taking longer to finish tasks.
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Managers themselves have a critical role in supporting employees in insecure work by defending workers’ contractual security, increasing their team’s autonomy at work, prioritising flexible working options, relentlessly developing their teams and better understanding ways to improve job satisfaction. Yet, fundamentally, managers can only do what’s in their gift to improve the situation. There is an even more significant role for employers and the government.
Over the past few years, the House of Commons has implemented critical legislation to help address some of these problems. Theresa May’s 2018 Good Work Plan introduced necessary workplace reforms, including the right to a payslip for all workers. The Employment Relations (Flexible Working) Act, brought forward by the Labour MP Yasmin Qureshi this year, means that employees will now be entitled to request flexible working arrangements from day one in their job. The Conservative MP Virginia Crosbie’s bill to require hospitality businesses to “fairly” allocate 100 per cent of tips to workers also received Royal Assent this year.
These individual policy changes are important. Yet they alone will not solve the problem. We are taking a pick-and-mix approach to insecure work, with a legalistic approach to dealing with individual issues in a piecemeal fashion. In truth, we are missing the bigger picture and the scale of the challenge requires bigger ambition.
The right to a great, secure job shares the same fundamental principle that sits under the “levelling-up” agenda – that we as a nation will be more prosperous when the opportunity is shared more widely and more fairly across the country. Looking to produce a workforce fit for the future? The more talent you can access, the better. Wanting to grow the economy? Incentivise businesses to create secure jobs with prospects for progression that drive greater productivity and consumer spending.
There are three approaches to this: lift the floor for all, focus on work and place, and establish sectoral best practice.
Any future government needs to shine a light on good and bad practices and to use the persuasive power of policy and regulation to encourage innovation. This means, choosing not to award lucrative contracts to companies that consistently fail to demonstrate their commitment to recognising talent in all its forms, including through genuinely equal pay across the whole workforce, to ensure everyone can benefit from access to flexible working, and a genuine living wage.
Alongside measures to lift the floor closer towards good, secure work, there needs to be a sectoral and place-based focus as well. Many cities, counties and combined authorities have established good-work charters. These should be given real energy by ensuring that leaders and managers have the skill to support their workers and improve their working lives. Skills development of those managers will be essential.
Sectoral agreements should also be promoted by local and central government. Initially voluntary but with real institutional teeth, and focused on the “everyday economy”, these agreements would drive skills and practice within employers to progressively establish the best approaches to good and fair work. Employers would learn from one another. In time, laggards could be compelled to meet minimum requirements on job quality, training and work-life balance.
The old saying “a fair day’s work for a fair day’s pay” doesn’t ring true in 2023. With one in five of the workforce in insecure jobs, often without a free choice, it’s little surprise that the UK is facing low productivity and stagnant growth.
As we head into the next election, it’s time for a united effort from business, public services and our political parties to prioritise secure jobs, empower workers and foster a culture of inclusivity and fairness – one that truly makes work pay.
CMI’s fringe event at the Labour Party Conference, a panel discussion on “A Labour agenda for Good Work: How can we deliver security, inclusivity and productivity?”, takes place at 15.30 at the ACC Liverpool on 10th October 2023.
[See also: The absurdity of the Tories’ “on your bike” plea]