Job Insecurity Haunts In A Tumultuous Economy

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  • When a downturn hits, many permanent workers can hunker down in their jobs.
  • Those in unprotected employment often don’t have that luxury.
  • The toll of job insecurity is on the rise.

We are witnessing a stark rise of job losses and rise of social tension as a consequence. Will it worsen or things are about to change? 

The Story Of Parker

Ryan Parker, 30, is typically hired by marketing agencies to deliver services for brands on a contract basis. Through the pandemic’s peak, industry demand was roaring. “Power went to the freelancers,” he explains.  However, this began to change at the turn of the year. In January, Parker abruptly lost two major contracts. It was an early sign of a looming downturn. “We began seeing budget cuts,” explains Parker, who has freelanced since 2017.

Through circumstances beyond his control, Parker, based in Lincolnshire, UK, was suddenly out of work. “It was a very difficult time not knowing whether I’d be earning a monthly income, particularly when I had a family to feed,” he says. Parker’s experience reflects what many freelancers, and those in other types of impermanent employment, have begun to see in recent months. “Many people have lost contracts,” he says.

But many suspect the worst is yet to come, as the financial outlook bleakens. When downturns hit, permanent employees can often hunker down in their jobs and ride out the turbulence. 

Job Insecurity

While full-time work is generally protected under employment law, freelance or gig work is more vulnerable to sharp drops in demand. When recession bites, employers can terminate short-term contracts or casual workers far more easily than making full-time staff redundant. Some workers opt for insecure employment so they can sell their skills and diversify their salaries on a freelance basis, while making time for family. 

However, other workers find themselves in unprotected employment through enforced circumstances. This can particularly happen in the service sector, with zero-hour contracts and gig work common in industries such as hospitality, transport and the arts. 

As the role of technology has grown, so too has the role of precarious employment in the economy. Statistics on exact numbers vary; according to one 2017 estimate by the US Bureau of Labor Statistics, temporary agency work, on-call work, contracted work or freelancing is the main source of income for more than 10% of US workers. People are also increasingly turning to platform work to fill income gaps; according to a 2021 survey, 16% of US workers had earned money from an online gig platform at some point, skewing towards younger and lower-paid workers. 

Hidden Toll

Without full-time jobs to rely upon, workers in insecure employment face a raft of pressures from which their more formally employed colleagues are better protected. Saying yes to more work creates a form of security, not only does it mean accumulating more wealth through a recession, but workers aren’t reliant on one stream of income. However, this form of financial planning doesn’t come without consequences. “After losing contracts, freelance marketers have probably taken on too much work to overcompensate,” says Parker. 

Overwork is just one way that workers in insecure employment might try to deal with stressful uncertainty. In general, says Chia-Huei Wu, professor of organizational behavior at Leeds University Business School, UK, a lack of financial stability can create a huge psychological toll for the self-employed. Financial stress can be exacerbated during economic downturns, adds Wu, with workers in precarious employment also likely to be without a workplace support network.

In a downturn, some workers in insecure employment will suffer more than others. For example, those in knowledge work might be more able to switch to full-time employment or have marketable skills that deliver a healthy wage. 

Many people in insecure work will be very worried about what the coming months will bring and the harm it might do to their financial stability and wellbeing.

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Source: BBC

 

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