Insight: Do workers really ‘choose’ unstable jobs?

The challenge

Are zero hours jobs and other ‘atypical’ jobs with highly fluctuating pay ‘bad jobs’? That’s the question Dr Silvia Avram, from the Institute for Social and Economic Research, has sought to answer.

Business organisations often claim unstable employment opportunities are vital for a successful labour market highlighting benefits to employers such as reduced staffing costs, while public arguments focusing on workers cite flexibility and the benefits of an improved work-life balance.

However, according to Dr Avram “the employer usually holds more bargaining power in an employment relationship, flexibility can easily become one-sided.”

So what do workers really think and feel about unstable jobs?

What we did

Using Essex’s Behavioural Science Lab, Dr Avram has shed new light on how workers feel about these atypical and unstable jobs.

Her experimental study, funded by the Nuffield Foundation and the Economic and Social Research Council, explored how workers react to uncertainty about work availability and associated pay.

Over 300, low income, UK residents took part in the study. They were asked to complete work tasks for varying amounts of pay. For one group work was always available but in two treatment groups participants had to choose whether to work before a coin flip that determined whether work was available.

What we learned

Far from preferring it, the study showed that workers avoided uncertainty where possible. Those facing uncertain work availability were less likely to choose to work, even when they were offered increased pay.

Dr Avram hopes her findings can help shape policy and has suggested that benefits changes could be used to encourage people to take up these insecure but flexible contracts.

“My research suggests workers perceive working hours flexibility they have no control over, and the associated income instability, as very costly.

“The current payment in arrears design of Universal Credit tends to accentuate rather than alleviate any fluctuations in income. The government should consider ways in which the benefit system can help low paid workers smooth their income and consumption in the face of earnings instability.” she said.