The rise of bad jobs’

While unemployment has dropped, new research shows that the state of the labour market is far from improving.

Look at recent unemployment figures, and you may think all is plain sailing in the world of work. But look a little closer and the reality starts to come into focus.

Two in every five people employed in the UK are in bad jobs’ — work which doesn’t provide a secure, living wage. This figure includes more than half of all self-employed people who are failing to earn a decent living, according to new research by the New Economics Foundation.

Our latest research calculates the proportion of people in good jobs, which are defined as people employed in permanent jobs, or voluntarily in temporary jobs, or in self-employment, who earn the Living Wage (as calculated by the Living Wage Foundation).

These findings go some way to explaining how a staggering two-thirds of Britain’s children in poverty are from working families. They also highlight how our key metric of labour market success, the unemployment figure, actually obscures reality — an insecure and underpaid workforce close to breaking point.

Whilst unemployment has fallen, the number of people in bad jobs remains stubbornly high. Indeed, in 2011 37% of the labour force was in bad jobs; and last year it was 39%. We have known for a long time that low pay and insecurity are urgent issues, and yet for years now the problem has gone unresolved.

Unemployment figures are massaged down by increasing numbers of self-employed’ workers overall, and by an increase in zero hours contracts.

While zero hours jobs are often thought to offer flexibility’, the reality is that one in three people on zero hours contracts say they don’t work enough hours, and only a quarter of people are on temporary contracts because they don’t want a permanent contract. And while some people choose to be self-employed because of the independence this way of working offers, many don’t. You only have to look at the fact that more than half of the self-employed don’t earn a Living Wage to know that the increase in the number of self-employed people isn’t much to celebrate.

The future of modern employment

The New Economics Foundation has been working on the issue of good jobs for over a decade, and welcomes the government-commissioned Taylor Review into modern employment published recently. But it is not enough.

We’re taking on the fight for good jobs by giving practical support to workers across the country to take real control of their working lives. We’ve been working with taxi drivers in Yorkshire – including former Uber drivers – to set up their own driver-owned app, enabling them to fight back against insecurity and excessive surveillance.

We’re also challenging bad employment practice in the gig economy by helping workers develop an App Workers Charter,’ outlining a voluntary code of good practice that workers can organise around and to which responsible employers can sign up.

And we’re working to bring competition policy into the 21st century. In some parts of the economy, firms are so dominant they are able to set prices and wages, to exert control over workers, and to increasingly pass on costs and risk whilst taking a greater share of the profit. We’re putting pressure on Government for better regulation and more up to date legislation.

For too long workers have been at the mercy of exploitative and threatening employment practices. It seems that good jobs have been sacrificed in order to avoid the worst effects of the recession. But we mustn’t let bad jobs become the new normal. We’re working to reverse this trend and put real control back in the hands of the workers.

If you value great public services, protecting the planet and reducing inequality, please support NEF today.

Make a one-off donation

£5 £10 £25 £50 £100

Make a monthly donation

£3 £5 £10 £25 £100