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Young people's experiences of precarious and flexible work – Evidence Review

This evidence review presents findings on young people's experiences of precarious and flexible work. These work conditions included where young people had for example zero hours contracts, low wages, lack of progression opportunities, dissatisfaction with current employment, or varying hours.


Chapter 4: What are the advantages and disadvantages of precarious working conditions?

This section of the review refers to RQ5: Are there any particular disadvantages, challenges, advantages, opportunities etc. of different potentially precarious or flexible working conditions?

As with other chapters much evidence reviewed in relation to RQ5 has a wider scope than those aged 16-24 and living in Scotland, however evidence provides a basis of understanding at a UK level. In examining evidence, it was apparent that aspects of work described as precarious or flexible are considered an advantage to some but a disadvantage for others. This depends greatly on the person’s circumstances, type of work, contract etc. and, as suggested by the Taylor Review of Modern Working Practices (2017), can differ by demographics. 

4.1. Advantages of precarious working conditions

The advantages of potentially precarious working conditions described in the evidence are limited. It should also be noted that advantages may not apply to all types of employment or to all workers across one employment type.

Flexibility

It was evident that flexibility caused conflicting views across the evidence examined. For some it was seen as a positive characteristic of employment, with the Taylor Review (2017) stating that flexible jobs open up work to people with different needs and priorities and at different stages in life. According to the review certain groups are more likely to place greater importance on flexibility, such as carers, women, those with disabilities and older workers. For some people within these groups, flexibility allowed them to participate more fully in the labour market by enabling them to balance work around other priorities. CIPD research also found that gig economy workers were more satisfied (60%) than other workers (44%) when it came to the amount of flexibility they have to decide their working hours (CIPD, 2017). 

The Taylor Review (2017) reports that flexibility works for many people and it is clear that an agile labour market is good for protecting employment; however, there are still concerns that some workers who have limited choice are not adequately protected in this type of employment. Details of this can be found in section 4.2.

Autonomy

There is evidence to suggest that those who have less autonomy over what they do at work tend to report lower wellbeing rates (TUC, 2016). 

In relation to the gig economy, CIPD research suggests that gig economy workers have more independence and autonomy, and therefore possibly more control over their work, which in turn can impact on their health in a positive way. The research found that 55% of gig economy workers expressed satisfaction with their level of independence and autonomy and 48% reported satisfaction with their physical and mental well-being experienced through work (CIPD, 2017). 

However, evidence reviewed also provides many examples suggesting that autonomy is not always a characteristic of flexible working, for example, where (as discussed in Chapters 1 & 3) there is an inequal power relationship between employer and worker and workers are at risk of losing employment if they cannot accommodate the working patterns set out by employers. This suggests levels of autonomy are not consistent across all precarious working positions, varying depending on the type of position and contract held. 

Stepping stone to other work

An article published by RBS, Gig economy “a springboard for entrepreneurs” (2019), claims that some workers in the gig economy use their job as a launchpad into longer-term entrepreneurship. It referred to the NatWest sponsored annual survey of UK entrepreneurs – Global Entrepreneurship Monitor (GEM) - which reported that gig workers were twice as likely as the wider population to be planning to start a business or be in the early stages of doing so. This survey found that 19.2% of people doing gig work for firms like Uber and Deliveroo were intending to start a business within three years, compared to 8.5% of the general population.

However, the GEM report also showed that the rates of entrepreneurship among the BAME population in Britain has significantly decreased, suggesting the changing shape of the UK economy may only be benefitting particular groups (RBS, 2019).

4.2. Disadvantages of precarious working conditions

The evidence reviewed identified a number of disadvantages for those in the types of employment highlighted as being at risk for precariousness (as outlined in Chapter 1). An overview of these have been detailed below. As with the advantages listed, it should be noted that disadvantages may not apply to all types of employment or to all workers across one employment type.

Insecurity / unknown hours 

As reported in the previous section, for some flexibility is seen as an advantage, however it can also be viewed as a drawback. Being able to work when you want is a positive thing; not knowing whether you have work from one day to the next is a disadvantage. The TUC’s Living on the Edge report references previous research which found that new recruits (in many cases younger workers), were often employed on ‘flexi-contracts’ with little choice over contracts or hours (‘flexi’ or ‘short-hours’ contracts are described in the report as those in which workers have a core number of guaranteed hours per week with additional hours of work also available). Unpredictability of working hours was described as an issue for workers, as shifts were changed at less than 24 hours’ notice, often as a result of staff sickness or absenteeism. It was highlighted that unpredictable hours had a significant impact on work-life balance as staff could not easily make plans outside of work or had to cancel appointments at late notice (TUC, 2016). 

While CIPD research makes a case for flexibility in the gig economy being an advantage to workers; it also reports that 50% of respondents to its survey thought people working in the gig economy make a decision to sacrifice job security and workers’ benefits in exchange for greater flexibility; thus suggesting that decisions are made based on a trade-off of different working conditions (CIPD, 2017). 

Lack of autonomy

Living on the Edge compares the experiences of those in permanent, fixed-term and casual positions across specific sectors in England. It reports that workers in casual employment were less likely (22%) to state they had a high degree of automony in their jobs compared to those in permanent positions (42%). This difference was further heightened by 52% of those in casual employment stating they had no automony over hours they worked, compared to 36% of those in permanent positions.

Please note: the report’s definition of casual work “includes agency work, seasonal work and other types of non-permanent work, excluding fixed-term employment” (TUC, 2016 p.4). Though not defined in the report, fixed-term contracts are understood to be as outlined in Chapter 1 (employment where there is a predetermined end-date or agreement work will end after a particular task has been completed, Hudson-Sharp et al., 2017), and permanent work to be work for which a continous contract is agreed, i.e. for which there is no predetermined end date.

Lack of skills / progression

One of the challenges for those working in employment considered at risk for precariousness may be progression to higher-quality, higher-paid jobs. Where employment is on a fixed-term or casual basis, or in cases of indirect employment (for example agency working), there is a risk that employers will not be willing to invest in worker training or development. According to CIPD research, for example, more than a third (35%) of gig economy workers reported that their employer or digital platform is unlikely to provide opportunities for them to go on training courses or learn new skills. Just under half (48%) also agreed that gig economy employers should invest in the training and education of the people they engage to provide services (CIPD, 2017). 

UWS-Oxfam Partnership’s 2016a report Decent work for Scotland’s low-paid workers: A job to be done documents a YouGov survey carried out in 2016 which also found a high incidence of low paid workers experiencing limited opportunities for progression: according to this survey 59% of workers in Scotland (aged 18-64) who earned less than £20,000 per year felt they did not have any career opportunities in the job they were in.

Low pay

While rates of pay will differ depending on type of employment, sector, contract type and other factors, evidence reviewed strongly suggests that most employment types considered potentially precarious or flexible are associated with low rates of pay and/or pay insecurity.

The TUC reported an inreasing pay gap for some forms of potentially precarious work when comparing average wage increases over a 10 year period, from 2006 to 2016. On average the hourly pay for zero hours workers increased by just 67p between 2006 and 2016, and these workers earned a third less than the average employee in the UK (across all types of employment) in 2016, compared to a quarter less in 2006. According to the report casual workers were also paid nearly 40% less per hour than the average worker (data is for 2016).

CIPD research reported that gig economy workers’ median average hourly rate was between £6 and £7.70 per hour depending on type of work; which is less than the National Minimum Wage (CIPD, 2017). An article for the Child Poverty Action Group has estimated that both members of a couple with two children would need to be employed full time and paid at a rate of £13 per hour before they could reach even the most basic minimum income standard to enable them to participate in society (Hirsch, CPAG Poverty, 2017, Not by Pay Alone). 

UWS-Oxfam Partnership’s labour market analysis of Scotland includes a survey of low-paid workers in which 37% registered disagreement with the statement that they were fairly paid compared to other similar jobs (a representative sample of 18-64 year olds, in Scotland, earning less than £20,000 per year were surveyed). This study also notes that Scottish Government data shows that 19.5% of workers in Scotland were paid less than the voluntary Living Wage in 2015 (UWS-Oxfam Partnership, 2016a).

Trade-offs and sacrifices

People value different facets of work. In return for greater job security individuals may decide to reduce their flexibility. Likewise, those opting for maximum flexibility may find that pay suffers as a result, with fewer opportunities for further development through training, as suggested by research among those working in the gig economy (CIPD, 2017). 

As alluded to earlier in this section (Insecurity/unknown hours) there is a sense that workers are having to trade poorer working conditions for the flexibility they need or want; or to accept certain conditions to ensure they have some form of income. According to CIPD’s report however, only 16% of 18-29 year olds agreed that having fewer rights and benefits is a fair deal in exchange for the independence they enjoy by working in the gig economy. Fewer, (11%), agreed that they don’t want to work for a traditional company in case they lose flexibility (CIPD, 2017). 

Interestingly, there are examples of companies using a trade off system to achieve certain goals such as flexibility in hours worked. An article in The Independent relates how in 2017 Asda offered a pay rise and an opportunity to gain a broader level of experience across the store to its 135,000 employees if they signed a new “flexible” contract. The new contract introduced a requirement to be available to work during bank holidays and not be paid for breaks. The increase in pay was £1 per hour more than the National Living Wage (£7.50). Asda stated they understood the flexibility would not suit all employees and therefore it was offered on an opt-in basis (Rodionova, Asda offers 135,000 staff pay rise in exchange for 'flexible' contracts, The Independent, 2017). 

There is evidence to suggest that conflicts between employers and their staff are familiar territory for legal practitioners (as are disciplinary scenarios that follow) when the employer expects co-operation over requests to work more hours (Puttick, Industrial Law Journal, 2019). It is expected that this will only increase as companies start to use trade-off systems like those similar to Asda’s above. 

In his blog Workers would give up half their hourly wages in exchange for a steady job (2019) researcher Nikhil Datta describes research in which respondents were offered ficticious job choices to determine which employment characteristics they most valued. This research suggests that the trade-off between security and flexibility is not in line with what is most important to workers, concluding that:

“Workers do value the characteristics associated with atypical work arrangements, though on average far less so than security. The most highly valued atypical work attribute was the ability to work from home, with both UK and US respondents willing to give up around 24 per cent of their hourly wage for such a benefit” (Datta, London School of Economics and Political Science Business Review, 2019)

Expectations of work

Much of the research and articles reviewed in relation to the advantages and disadvantages of flexible working report information at a UK wide level rather than Scotland specific level. There is also limited data relating to the 16-24 age group.

However research by the UWS-Oxfam Partnership What Scotland’s future workforce think about decent work (2016b) explores the views and expectations of young people in Scotland in relation to the world of work. 

Research found that expectations of work among secondary school pupils were highly positive, with most expecting to find ‘decent work’ that would be likely to include in-work training, pay that allows them to live comfortably, and in which they would be protected from ‘exploitative and unsafe work’. 52% of students also expected working hours to be regular and ‘at a time that suits me’ (UWS-Oxfam Partnership, 2016b).

Expectations and aspirations of work among the future workforce in Scotland are therefore not consistent with descriptions of flexible working found in much of the evidence reviewed, making it likely that the working conditions which some young people will experience upon entering the world of work are likely to fall far short of what they hope for and expect.

Contact

Email: youngpersonguar@gov.scot

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