A crisis of control: do the demands of the ‘on-demand’ workforce need to change?

by Alice Martin

When it comes to work, the UK is facing a crisis of control. British workers report the highest sense of job insecurity of any country in Europe and work among the longest hours. Low unemployment figures mask a growing number of people without a regular wage or employment rights – the percentage of people in ‘good jobs’ that are secure and well paid is in fact dropping year on year. Workers’ loss of control over hours and pay has big implications: for many young people, the idea of putting away for a secure future, whether with a pension or savings, is just not an option.

The rise of insecure work over the last decade picks up the baton from a longer-term macroeconomic trend of wages giving way to profits. In most developed economies, the UK included, over the last thirty years there has been a shrinking of the slice of the GDP pie for employees, with a growing slice going to business owners and investors.

What has caused this shift? Technological change is the most common answer: as machines increase productivity and replace workers in certain roles, the wage bill is reduced and profits rise. But a survey of the evidence reveals that it is in fact changes in the structure of the labour market, and in particular, the steady decline of trade union bargaining power, that has had a more substantial impact on wage suppression in favour of profits across Europe. Taking the UK as an example, the fragmentation of collective bargaining structures, fall of manufacturing and public sector jobs in favour of a growing service sector, and a hostile policy environment for trade unions – exemplified most recently with the Trade Union Act – have all underpinned the shift.

With the march forward of self-employed and ‘on-demand’ work into an increasingly Uberised jobs market, the weakening of the workforce’s control over issues like job security and pay is set to become engrained. Our sense of security is one of the most important ways our jobs affect our overall wellbeing; lack of control at work is a major cause of stress.

National income itself is also likely to suffer. The UK is a wage-led economy meaning that less money in the pockets of people to spend equals less economic activity overall. So much so that the decline of collective wage bargaining here could in fact represent an annual GDP loss of £444 per person. Recent parliamentary investigations into whether our employment laws and tax policies are fit for purpose, in response to stories ofinjustice and exploitation in casual and zero-hours work offer some reassurance that the insecure work crisis is being taken seriously. But these efforts are somewhat overshadowed by the counter-veiling forces. These include Brexit negotiations that could signal a major erosion of workers’ rights and corporate pressure from companies built around casual labour like Uber and Deliveroo.

A growth surge in the gig economy has seen what are categorised as ‘businesses with no employees’ growing by 72% in London, and 28% in the UK as a whole. These companies
lower costs to customers by relying on ‘independent contractors,’ though in Uber’s case the courts recently concluded they are more appropriately categorised as ‘workers.’ For young men in particular, a group suffering from under-employment, entering this type of work is not always based on choice, but necessity.

The platform organisation of the on-demand workforce means there is always someone else ready to take the job of an unhappy worker – and this is really the crux. Technological innovation may not literally spell machines taking jobs and suppressing the wage share; rather, technological developments allow for algorithmic human resources and employee surveillance. This is surely not the techno-utopia some of us have, in wistful moments, dreamt of.

The recent call for a recruitment freeze from the IWGB Brighton Deliveroo Riders branch shows that the issue of labour supply is ripe for politicisation. As self-employment
grows in place of other forms of work, there are more people in the labour market unprotected by the regulations that put boundaries around how long we can work and for what pay. Targeting excessive recruitment may therefore be a logical tactic for organised workers at a micro level: an attempt to exert control over labour supply and win support for other demands. But if that ask is scaled up to a macro picture, it takes on a troubling protectionist undertone, perhaps particularly so as we enter the age of Trump. We too often hear the idea of excessive labour supply in the economy weaponised in debates on migration, as Bridget Anderson addresses in her contributin to this series, despite the ample evidence showing the positive economic effect of migrant workers.

If relinquishing employment rights in exchange for a “job today” is a bad deal for many, the striking Deliveroo drivers should be commended for drawing attention to the impossibility of withdrawing your own labour supply when it’s so readily replaced. One way of avoiding divisive traps that might emerge from the changing nature of work today is to demand an inclusive and simplified approach to employment law that insists on a living wage, control over working hours and the genuine ability to withdraw your labour – that applies, crucially, to anyone carrying out work under any label. A fairer distribution of well-paid work across the economy is surely the aim.

About the author

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Alice is a researcher at the New Economics Foundation. Her current research covers the impacts of inequality and financialisation on the economy, as well as on peoples’ lives and work. Most recently she has begun coordinating a project looking into how the UK housing crisis and finance system are intertwined, as well as carrying out research into the role trade unions play in the economy.
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