Young hit hardest by insecure work and falling pay

Young Workers April 4 2017

Young people’s experience of work has been dominated by the impact of the recession and recent political, social and economic uncertainties following Britain’s vote to leave the EU. Changes to the labour market have placed us at the sharp end of falling pay, rising insecurity and poor retirement provision. Yet at the same time, millennials are less likely to join a trade union; just 5% of 16-24 year olds and under one fifth of 25-34 year olds are trade union members.

It’s not all as depressing as it sounds – unemployment levels are now at their joint lowest since 1975; the jobless rate fell to 4.7% in the three months to January and more people in work can only be a good thing. But it’s the changing nature of the jobs market in the past few years that has sparked debate about the future of world of work in Britain. Indeed with new forms of work come changes in employment practice and law and how this can be achieved for the interest of the working population is what is so crucial for unions to address.

The insecurities faced by millennial gig’ economy workers can be offset by trade unions. Unions are challenging poor working conditions of these vulnerable workers and helping them to protect and know their employment rights. The number of insecure workers in the UK has gone up 25% since 2011. There are over three million people in some form of precarious work (seasonal, casual, agency or temporary work, zero hours and false self-employment) and the TUC says this is costing the Exchequer around £4bn a year. ONS figures show that young people and women are disproportionately affected as 33% of people on zero hour contracts are aged 16-24 and 50% of those working on these contracts are women. For some with study commitments and caring responsibilities it offers flexibility but for most it means low pay, low-skilled and poorly protected jobs.

Changes in the job types held by millennials have stagnated their pay. Technological advances and the growing use of digital platforms have the potential to create high quality decent jobs, yet we are seeing many having to work harder and faster for less pay and protection. According to research by the Resolution Foundation and Intergeneration Commission millennials who have entered work so far have made no earnings progress on generation X before them. They found that lower pay rises when employees stay with firms for long periods and a decline in job mobility have played a huge role. But this wasn’t the only reason; the report states that this could also be down to the impact of the recession, growth rates in educational attainment, the impact of changing occupational structures and the rise of atypical working.

Resolution Foundation’s Laura Gardiner commented: “one of the most striking shifts in the labour market has been young people prioritising job security and opting to stick with their employer rather than move jobsin a jobs market characterised by rising temporary work and zero-hours contracts. But with the typical pay rise for a job-mover in their mid-20s at around 15 per cent, and evidence that employers have essentially stopped rewarding their long-serving staff with real annual pay increases, such job loyalty can be very costly.”

Clearly more needs to be done to tackle the reality that is insecure, low paid and low quality jobs without workplace protection, especially for younger people who are just starting out in their careers. With the rise in legal cases against companies who engage in exploitative employment practices, the government is launching a review into the regulations and practices of modern employment, led by RSA chief Matthew Taylor. It will address 6 key areas: security pay and rights, progression and training, balance of rights and responsibilities, representation, opportunities for under-represented groups and new business models. The Department for Business, Energy and Industrial Strategy is also to launch a research project into the scale of the gig economy and the reasons why people engage in gig’ work.

The CWU is calling for a new deal for workers with employment rights and collective bargaining as its focus. The government must follow through on its pledges to make the economy work for everyone. Legislative changes must be complemented with reforms to empower trade unions to play a greater role in the workplace and to ensure that all workers are protected. At the beginning of the year, the General Secretary urged young members at the Youth conference to embrace a fundamental agenda of change in order to re-energize’ the CWU. He warned that the future industrial outlook would mean big businesses driving up inequality to the cost of their employees and wider society.

Changes in working practices brought about by new ways of using technology to create new services to meet consumer demand is leading to a change in the working world and young people must ensure that workers’ rights are upheld. If you’re in a zero hours contract or in any form of insecure work or know someone wh
o is, you can help the TUC campaign for fairer treatment at work. Filling in this survey will help unions in the fight to protect vulnerable workers like you. It also helps to know what your rights are at work.

Compiled by:

Anneka Bhardwaj

CWU Research Department