HR · 3 March 2017

Almost a million UK workers now on zero-hour contracts

services sector
Growth of zero-hour contracts has begun to slow down due to a number of contributing factors

The number of UK employees on zero-hour contracts has reached an all-time high, according to new figures from the Office for National Statistics (ONS).

In the final three months of 2016, the number of workers on the controversial employment terms reached 910,000 – an increase of 110,000 from the same period in 2015. It also represents a 30 per cent increase of the number of zero-hour contracts used in the final quarter of 2014.

According to analysis of ONS data by the Resolution Foundation think tank, the sectors most dependent on zero-hour contracts were the hospitality and health and social care industries. Zero-hour workers in “accommodation and food” businesses represented a quarter of the entire zero-hour workforce, while one in five worked in “health and social work”.

Conor D’Arcy, a policy analyst at the Resolution Foundation, zero-hour employees were now “a significant proportion of the workforce”.

However, despite record numbers, zero-hour contracts could be on the decline. ONS figures showed zero-hour contracts grew at a slower rate than regular employment in the second half of 2016 for the first time since the term was coined in 2013.

Compared to the first six months of 2016, the number of zero-hour employees increased by 0.8 – just 7,000 workers. In contrast, the second half of 2015 witnessed 7.7 per cent growth from the first six months of the year.

In its report, the Resolution Foundation suggested that this could be due to a combination of three factors – high employment rates making it harder for employers to fill short-term positions, growing awareness of workers over the realities of unstable hours and the potential for reputational damage.

The think tank stated that “no employer wants to be the next Sports Direct”. A parliamentary committee concluded in 2016 that working conditions in the warehouses of Mike Ashley’s sportswear business resembled those of a “Victorian workhouse”.

The Resolution Foundation also revealed that the number zero-hour contracts given by Homebase, Wetherspoons and McDonalds had fallen in the last six months.

D’Arcy added that “signs of change” had begun to appear.

“This is about more than just the general slowdown in employment growth, with a bigger drop visible in the growth of zero-hours contracts. The negative publicity these contracts have attracted may well have played a role in their slowdown, as firms rethink their use,” he said.

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ABOUT THE EXPERT

Simon Caldwell is a reporter for Business Advice. He has a BA in politics and communications from the University of Liverpool, and previously worked as a content editor in the ecommerce industry.

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