Jonny Gifford, Senior Advisor for Organisational Behaviour, CIPD
This weekend saw a potentially major shift in the UK government’s priorities, with the prime minister placing a new urgency on getting the economy going again. Fears of 3½ million jobs lost and levels of unemployment not seen since the 1980s have led the prime minister to decide that as far as is possible, the UK needs to get back to “normal” by July. Target areas for loosened restrictions include pubs, cafes and restaurants, hair and beauty, weddings and funerals, high street retail, places of worship and driving instructors.
The scale of the risk to the economy is underscored by a recent poll, which found that half of employers envisage making redundancies when the furlough scheme ends. And the fear is clearly shared by workers. Over recent years, the CIPD Good Work Index has seen consistent perceptions of job security, with about one in seven UK workers believing they are likely to lose their job in the next year. From January to April this jumped steeply to nearly one in four, where it remained in May.
Which jobs are most at risk? Few workers are immune…
In general, the risk of losing one’s job is present across all broad job types and levels of seniority – that is to say, few workers are immune and there is no clear pattern across occupational class. But in another aspect of employment security – whether people have enough work to make a living – we find clear differences. Workers in routine and manual occupations are much more likely to be underemployed than other employees, with as many as one in four wanting more work than they currently have.
What’s more, these workers are also more likely to be currently furloughed: the CIPD’s ongoing survey of working life during the pandemic shows that over the last two months, 30% of manual workers have been furloughed, compared to 21% of managerial, professional and administrative workers. It’s hard to predict where the greatest job losses will be in the longer term, but in the short term it is clear which jobs are most at risk.
Proportion of workers underemployed (%)
Another aspect of employment security closely related to working hours is contract type. It must be said that some workers want the flexibility of temporary, zero-hours, or other ‘non-standard’ contracts, so we cannot assume that such working arrangements are always bad. Nonetheless, there is a valid concern that they are often one-sided, benefiting employers but not workers and leading to precarious employment. Certainly, workers on such contracts are more likely to lose their jobs once the furlough scheme is wrapped up and the recession truly bites.
There’s both a moral and a business case for reducing job insecurity
Many employers will inevitably face tough decisions between keeping people in work and making cuts to stay in business. But as well as the social responsibility to provide stable and good quality work, there are also good business reasons for reducing job insecurity.
When it comes to the efficient running of organisations, we find two opposite trends in employment contracts. On the one hand, our analysis shows that employees on non-standard contracts report slightly higher task performance than those on permanent contracts. This is the basis on which some employers have been accused of using job insecurity to try to increase short-term productivity, treating labour as disposable and ruling by fear to control workers.
On the other hand, if we look at the wider ‘contextual’ performance, it is evident that any such benefits are narrow: workers with permanent contracts are more motivated to go beyond the core tasks required of them to help their organisations. In this sense, contractual stability is one basis for enriched, less transactional and more productive employment relationships. This is hugely important for service quality, responsiveness and innovation – the longer-term aspects of performance.
Last summer, the UK government pledged legislation to give all workers rights to move towards more predictable and stable contracts. At the same time, it has shown commitment to increasing employees’ options for flexible working arrangements. Both these areas are important steps in giving workers the security and choice they need to shape their working lives. Where the demand for labour is continual, employers should give workers the choice over having a permanent or fixed hours contract. And wherever possible, flexible working practices – including but not limited to working from home – should be accessible as the norm, not just for a privileged few.
We live in a time of substantial fear. The fear of direct impact of the pandemic remains, with 44% of workers anxious about returning to work after the lockdown; the fear of redundancies and unemployment is growing. The government and many employers have hugely difficult decisions ahead and, at times, short-term pressures will inevitably override all else. But it is to be hoped that neither the government nor employers lose sight of longer-term considerations. Good quality and stable jobs are not a luxury, they are a lifeblood of a healthy economy and society.
