Tuesday 14 August 2018

Rise of zero hours contracts means facing hard choices

'The challenge is to define and eliminate exploitation, while accepting that attempting simply to turn back the clock is doomed to failure and is likely to do more harm than good.' Stock image
'The challenge is to define and eliminate exploitation, while accepting that attempting simply to turn back the clock is doomed to failure and is likely to do more harm than good.' Stock image
Brendan Keenan

Brendan Keenan

Statistics are slippery things. Even when they are correct, they can cause trouble, and few are as slippery as those concerning 'precarious' work. Perhaps those Italians campaigning for a change were right to invent a patron saint, San Precario, to help their cause.

Just how metaphysical the data can be was made clear in last week's Geary lecture at the Economic and Social Research Institute (ESRI) on the subject of job insecurity. Professor Arne L Kalleberg of the University of North Carolina was showing the results of surveys in six different large economies. Making sense of them would try the patience of a saint.

Startlingly, the UK and the US appeared to have half as many workers in temporary employment as Germany. That hardly accords with observation of their respective economies. Different definitions, and different employment patterns to begin with, help explain the anomaly,

That is a little problem of statistical analysis but in this area the raw figures themselves are difficult to come by. Hence the unusually open spat between the trade union Mandate and the ESRI's Prof Seamus McGuinness after the union claimed that "tens of thousands" of workers, across dozens of sectors, were on zero-hours and "if and when" contracts of employment which the union wants abolished.

The number was based on a 2015 study by the University of Limerick which found that 5pc of workers have variable weekly hours. That would amount to around 100,000, which does seem like an awful lot of irregular work and variable hours as such are not the issue.

Prof McGuinness's point was that we do not know much about what is going on because there is no evidence of the exact contractual nature of the jobs, or the degree of variability in hours.

This is more than a statistical conundrum. A major economic and social change is under way. There is no doubt that policy must respond but it is a mistake to think that we know much about it as yet, still less how best to deal with it.

Many medical students are attracted to a career as GPs precisely because it offers more flexibility than hospital jobs - although this does not necessarily improve the service to patients. Substitute teaching is precarious, full-time is not, but the full-timers need substitutes.

Most of those making these kinds of choices are (careful now) women. If child rearing were shared equally between men and women it might not be so; but it isn't.

Prof Kalleberg is a liberal (ie left-leaning) sociologist, which, as a Mandate official attending the lecture said, would not exactly make him flavour of the month in the USA these days.

Nor will he be all that popular in his own circles for stating that the entry of women into the workforce is one of the major reasons for the dramatic changes in the world of work.

Very few, least of all the professor, would want to reverse that process. That leaves two other factors, globalisation and technology, as major forces for change. The former may be rolled back somewhat - which may or may not be beneficial as a whole - but the latter cannot and its biggest impact is probably yet to be seen.

The implication is that, for the most part, there will be no return to the world of the 40-hour weekly, secure job; probably with pension attached.

That is no reason to allow a return to the world of Jim Larkin, with its casual labour, piece rates and insiders with their precious trade union buttons, but it will not be easy to prevent.

The challenge is to define and eliminate exploitation, while accepting that attempting simply to turn back the clock is doomed to failure and is likely to do more harm than good.

The real horror story in the slippery statistics is Spain. Its data on the risk of unemployment barely fitted on Dr Kalleberg's chart. The reason is badly designed and long-standing job protection laws which have left about half the workforce in employment so impregnable that no one wants to hire the rest, especially the young.

Changing that might improve matters in the medium term but it would impoverish a large chunk of the Spanish population in the meantime.

Other European countries, with strong traditions of social protection, are looking for new answers to these new questions. Twenty years ago, Finnish restaurants would close at weekends because regulations made weekend work so expensive. Now they are examining the radical idea of basic income, irrespective of work status, to make things less precarious.

In Denmark, the social partnership system is trying to "collectivise" risk between employers, employees and the state. Portable social security, minimum hours and sick pay across all jobs. Yet, in this country anyway, it has proved immensely difficult to do this just for pensions: imagine trying to apply it to the whole social insurance system.

As another colleague betimes, Colm McCarthy, has said; for a Danish model you need Danes. But it is still depressing that in Ireland this issue is being forced in the traditional, although quite proper, way of a trade union defending its members. Trouble is, in that process government first finds itself aligned with producers and employers, until political embarrassment forces it to change tack and cobble together some piece of nonsense as a compromise.

There will be costs for employers. Technological and social changes present firms with unprecedented opportunities for flexibility, but also a chance not seen in almost a century to depress wages. They cannot be allowed to have both and must face up to the price of flexibility.

It could be even worse if this is seen as an EU problem requiring a harmonised set of regulations. I myself saw freelance journalists lose their income because of inept EU rules that they must have the same conditions as permanent staff.

There may be some merit in watching how Finns, Danes and others get on as a basis for devising EU-wide policies, rather than some more dirigisme from Brussels. Ireland should be included in the Commission's watching brief. Whatever our many failings, something in the Irish system is pretty effective at creating jobs.

Many did prove to be precarious in the ups and downs of the economic cycle but trying to eliminate that is as unwise as trying to eliminate the cycle itself (as distinct from smoothing its effects).

"If Uber drivers become employees, that is the end of Uber," said Dr Kalleberg. One can argue as to whether that would be a good thing or not, but one had better be pretty sure about one's objective before starting down the road.

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