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Zero Hour Contracts Have More Than Tripled Since 2012

Zero hours contracts make up a quarter of employment improvements since 2012

The number of UK workers on zero hours contracts has more than tripled since 2012, propping up overall employment levels by accounting for almost a quarter of overall employment improvements, according to new research by job search-engine Adzuna.

With the employment rate currently at a record high of 75.7% according to the ONS, the study compares recent growth in the number of people in work overall to the increasing prevalence of zero hours contracts specifically, to drill down into the detail behind the headline growth figures.

Zero hours contracts have grown by 258% since 2012, with 901,000 workers currently employed on this contract type, up from 252,000, and zero hours workers currently representing 2.8% of the UK workforce.*

Meanwhile, the number of workers in employment overall has risen by 2.42 million over the same period, from 29.73 million in 2012 to 32.15 million in 2017.** This means that zero hours contracts represent more than a quarter (26.8%) of overall employment growth over the past five years.

Table 1: Growth in Zero Hours Contracts since 2012

October – December 2017 October – December 2012 % increase
Number of UK workers on Zero Hours Contracts* 901,000 252,000 258%
UK workers in employment** 32,150,000 29,730,000 8%

Gig economy growing, with quarter-of-a-million vacancies currently on offer

Recent figures estimate that the booming gig economy employs more than 2.8 million workers overall, including freelancers, contract staff and part-time workers, as well as those employed on zero hours contracts.***

The sector is growing fast, with almost a quarter-of-a-million vacancies (225,000) currently being advertised on Adzuna. As at 1 September 2018, there are 143,294 temporary contract vacancies, 6,838 freelance roles, and 74,983 part-time positions available on the UK jobs market.

Majority of gig economy roles based in the South

Many of these jobs are clustered in London and the South East. The capital currently boasts 2,387 freelance opportunities (offering an average salary of £49,907), 26,071 contract vacancies (with an average salary of £36,825) and 9,671 part-time positions (with an average salary of £28,417).

However, opportunities for flexible work are much fewer away from the home counties. The North East, for example, currently offers only 141 freelance vacancies (£41,912), 3,933 contract roles (£24,725) and 2,480 part-time opportunities (£25,741). Similarly, Yorkshire & Humber boasts just 217 freelance roles (£44,175), 7,408 contract jobs (£25,054) and 3,918 part-time vacancies (£25,499).

Andrew Hunter, co-founder of Adzuna, comments: “Today’s jobs market is a totally different beast to five years ago. Employment levels have increased, but a big chunk of this boost is down to a boom in zero hours contracts. Salaries have lifted, but so too has inflation, meaning many people are using the gig economy to top-up their pay packets. Further workers have been forced into self-employment not out of choice but to escape the breadline.

“What is emerging is a more flexible jobs market that offers people more opportunity to fit work around their lifestyle. This is especially crucial to help working mothers, students and older workers – for whom full-time 9-5 may be impossible – to break into and stay in the workforce. But it is important that workers needing flexibility aren’t forced into contracts with no security or guaranteed pay simply through a lack of choice.

Looking at specific companies, the top 5 gig economy employers are currently Uber, PeoplePerHour, Deliveroo, Fiverr and Upwork.

Table 2: Top 5 Gig Economy Employers****

 Ranking Company % of gig economy employees who have made money using app/website
1 Uber 18%
2 PeoplePerHour 12%
3 Deliveroo 12%
4 Fiverr 10%
5 Upwork 9%

*Figures for zero hours contracts are for October – December 2017 and October – December 2012, taken from “Contracts that do not guarantee a minimum number of hours: April 2018” report by the ONS

**Figures for employment overall are for October – December 2017 and October – December 2012, taken from “UK Labour Market: February 2018”  and “Labour Market Statistics, February 2013” reports from the ONS

***Estimate taken from “The Characteristics of those in the Gig Economy” report by the Department for Business, Energy & Industrial Strategy, February 2018

****Top 5 gig economy employers table taken from “The Characteristics of those in the Gig Economy” report by the Department for Business, Energy & Industrial Strategy, February 2018