The Strategist

3% of employees in Britain are working under zero-hour contracts

09/08/2016 - 16:10

Almost 3% of UK workers have zero-hour employment contracts. This is an employment contract under which an employer does not guarantee daily employment, but pays only for hours that an employee actually worked, according to the UK Office for National Statistics.

Jérôme Dessommes
Jérôme Dessommes
According to Reuters, number of people working in such conditions, has increased by 20% in comparison with the previous year. This is fueling a debate about absence of job security in the post-crisis era in the UK.

The extreme flexibility of labor contracts does not guarantee a minimum number of hours of employment. This is rather controversial, however, large companies continue to use such agreements.

The ONS reported that number of workers who have no guarantee of working time has increased over the first half to 2.9%, compared with 2.4% in the same period in 2014.

The data indicate that such contracts are still used quite rarely. However, it is still common in the UK, and labor market recovery hasn’t improved the trend. Previously, experts believed that zero-hours employment contracts are solely as a post-crisis phenomenon. The papers would disappear once employers stop being nervous about hiring new employees. Yet, apparently, such contracts have struck roots into the British economy, while unemployment in the country is at 4.9%, which is a minimum of 11 years.

The ONS believes that zero labor contracts were concluded mainly with young professionals, students or young mothers. On average, these specialists work 25 hours a week. About 30% of these professionals want to achieve increase in working time at the current position, so as not to change jobs.

Nick Palmer, a specialist from ONS, added that the statistical service will continue to follow the trend in order to understand current changes in the UK market of employment. According to experts, the increase in the number of workers in these labor conditions could be associated with increased public awareness of zero employment contracts. 

Previously, the service reported that the unemployment rate in the UK in April-June remained at 4.9%, that is, at the level of March to May.

The indicator has coincided with a forecast of analysts surveyed by Reuters.

Number of unemployed in the country amounted to 1.641 million people in April-June. This is 207 thousand less than in the same period a year earlier, and the lowest figure since May 2008.

Number of employed Britons aged 16-64 in April-June increased by 542 thousand compared to the same period last year, and amounted to 30.543 million people, or 74.5%  - the highest rate since the very start of the accounting data in 1971 .

Wages of employed Britons, taking into account bonuses, increased by 2.4% on an annualized basis, and by 2.3% excluding bonuses. 


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