Research Findings

What is precarious work, and what happened to precarious workers during the COVID-19 pandemic?

February 2, 2023

It is highly likely that your parents, or grandparents, depending on your age, worked full-time for the same employer for many years, even a lifetime. They accumulated job tenure, had regular working schedules, and their employer directed the work they did at the place of business.

This standard employment relationship (SER) model is defined by stability and continuity. Yet, recent decades have witnessed gradual transformations in work arrangements and employment contracts due to economic, technological, and globalization changes.

One of the most notable transformations is the proliferation of precarious work, a departure from the model of stable and secure employment with benefits. Precarious workers lack employment stability, they change jobs, and move in and out of the labor market. When they work, it is likely in part-time and temporary jobs that do not provide social benefits and statutory protections.

The term “precarious work” describes workers lacking labor market stability and continuity, having bad jobs, and experiencing economic insecurity.In myWork and Occupations article, I examine what happened to precarious workers during the COVID-19 pandemic and question the effectiveness of the standard definition for this group of workers.

The blow of the COVID-19 recession was predictable

We tend to think that the COVID-19 blow was random because, unlike other recessions, it stems from an exogenous, abrupt, well-defined, and non-fiscal shock. Moreover, in contrast to other disasters that cause substantial physical damage and large-scale migration, the COVID-19 outbreak has not led to population mobility. Instead, it has forced people to stay at home without employment alternatives.

My research demonstrates that the wrath of even an exogenous, abrupt, and non-fiscal shock is not random. Like other typical recessions, individuals with volatile careers or at the bottom of the socioeconomic ladder have been the first to lose their jobs. Thus, the COVID-19 blow was predictable, directly targeting precarious workers, those lacking labor market stability and job security.

Hence, the first insight that COVID-19 helped us formulate is that COVID-19-generated unemployment was not unique compared to prior periods of labor market constriction. The second insight is that there is a problem measuring precarious work. The COVID-19 jolt was strong enough to expose the need to revise the definition of precarious work.

The definition of precarious work

Employment instability, the core element in precarious work, can take many forms, including changing employers, occupations, mode of employment (salaried/self-employed), spells of extended unemployment, and holding concurrent jobs. The link between employment instability and labor market outcomes is complex. Workers’ history of employment volatility can lead to inferior labor market outcomes.

Still, mobility can also be vital for improving job quality and serve as a stepping stone for career development. For example, for some workers in nonstandard employment (such as independent tech contractors), high turnover is voluntary and desirable also in good economic times. This class of professionals, such as consultants, project-oriented freelance workers, and short-term contractors, lack employment security and statutory protection but are well compensated and enjoy independence and flexibility.

So how do we distinguish them from “precariats”? Those whose instability is involuntary and whose jobs do not provide adequate income and benefits, intellectual stimulation, regular working hours, and an innoxious environment? The definition of precarious work helps us distinguish the two groups by mingling employment instability, its core feature, and various aspects of job quality.

What happened to unstable workers during the COVID-19 pandemic

Based on data from Israel collected before and during the pandemic, my research demonstrates a significant surge in employment volatility during the pandemic labor market turmoil. On average, the number of employment transitions (for example, between employers, occupations, employment modes, to unemployment) in the working-age population rose significantly, from 1.6 pre-pandemic to 2.3 during the pandemic. Moreover, the share reporting zero employment transitions within five years declined from 50 to 34% between the two periods.

In the pre-pandemic full-employment market, a history of employment volatility does not have a scarring effect on employability. Almost anyone who wants to work is employed, and those in bad jobs are counted as precariats. Yet during a recession, personal history of excessive employment volatility is detrimental to employment stability. Consequently, individuals with volatile careers are less likely to be employed and are thus not counted as precariats.

The problem with the definition of precarious work

By including aspects of job quality in the standard definition of precarious work, we exclude non-workers from it. Since workers with unstable jobs and no statutory protections are the first to lose their jobs during recessions, we cannot observe their job quality; therefore, they are not considered precarious workers.

According to the current definition, one cannot be classified as a precarious worker if she is currently out of work, even if she was employed or will find herself employed in unstable and low-quality jobs in the near future. This is a serious problem in estimating the magnitude of precarious work because moving in and out of employment is a defining feature of precarity. The fortunes of precarious workers during the COVID-19 pandemic highlight this key dimension of precarious work.

A biased measurement

This problem introduces a bias in the measurement of precarious work in all economic cycles. However, the bias is more severe during recessions than in a full-employment economy because the share of the unaccounted-for population as precarious workers is much larger during recessions. Thus, basing estimates only on employed individuals can likely lead to underestimating precarious work during recessions, precisely when precarious workers lose ground.

I demonstrate this problem through economic insecurity, an essential aspect of precarious work. When limiting analyses to employed individuals, as the “precarious work” construct mandates, we get an upwardly biased estimate of individuals’ financial situation. This is because the economic situation of workers is typically better than that of non-workers. Naturally, this bias is more severe during a recession than during a full-employment labor market.

The key hardships of precarity are typically hidden from view

The nuanced analysis conducted in this study reveals that the COVID-19 recession has laid bare the soft spots of volatile careers: employment instability, employment uncertainty, and economic insecurity. These aspects are the quintessential characteristics of precarious work, yet the typical definition of the construct would have overlooked them. Thus, key hardships of precarity are hidden from view during recessions because of a high level of unemployment.

From precarious work to precarious employment

How to correct this measure? Under the umbrella of precarity, we should include working-age individuals with volatile careers (i.e., a high employment volatility history), if they are currently working in “bad” jobs, lack social protection, and experience economic insecurity, or if they recently lost a job characterized by the same features. This shifts the emphasis from precarious work to precarious employment.

Why is this important?

COVID-19 may exacerbate the effect of drivers of precarious employment. This rise threatens to destabilize the political system, questions the social contract, and weakens solidarity. Our ability to monitor the spread of temporary and insecure employment, design effective labor market policies, contemplate a universal basic income, and rethink the political arrangements that cherish flexibility, depends on the availability of effective estimates regarding the true scope of employment precarity. Therefore, we need to ensure that those precariously employed are included in our estimates, regardless of economic cycles.

Read more

Sigal Alon. “The Measurement of Precarious Work and Market Conditions: Insights from the COVID-19 Disruption on Sample Selection.” Work and Occupations 2022

image: food lines via Flickr (CC BY 2.0)

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