LS12 - Labour Market Issues Flashcards
What is a zero-hours contract.
Zero hours contracts do not guarantee a minimum number of working hours each week.
Who is more likely to be on zero hours contracts in the UK labor market?
Young people, part-time workers, women, and those in full-time education.
What trend was observed in zero hours contracts in the UK from 2000 to 2016?
An increase in the number of people employed on zero hours contracts.
How many people were employed on zero hours contracts in the UK between April-June 2017?
883,000 people, which is 2.8% of all people in employment.
What are some arguments in favor of zero hours contracts?
They allow businesses with highly seasonal demand (e.g., retail, brewing, tourism, catering) to better control costs and offer flexibility for individuals who want to choose when they work.
What are some arguments against zero hours contracts?
They can contribute to “in-work poverty,” making it difficult for individuals to earn enough to avoid relying on welfare benefits. Uncertain incomes can also hinder access to loans, mortgages, and mobile contracts.
What notable decision did McDonald’s make regarding zero hours contracts?
What was the outcome of McDonald’s trial to offer guaranteed hours?
McDonald’s offered 115,000 UK workers the option to switch from zero hours to fixed contracts with guaranteed hours. (2017)
About 80% of workers chose to remain on flexible contracts, and the company reported increased employee and customer satisfaction.
What is the gender pay gap?
The difference in average earnings between men and women, often expressed as a percentage of men’s earnings.
What is the ethnic pay gap?
The disparity in earnings between individuals from different ethnic backgrounds, often reflecting systemic inequalities.
What are some causes of the ethnic pay gap?
Discrimination, unequal access to opportunities, differences in education and work experience, and occupational segregation.
What is the apprenticeship levy?
The Apprenticeship Levy is a government intervention designed to increase funding and take-up of vocational training. The levy requires businesses with an annual wage bill of £3 million or more to pay0.5% if their payroll costs into an apprenticeship fund that they can then access to pay for training. The government provides additional top-up funding.
What are some downsides of the apprenticeship levy?
- Cost Burden: The levy imposes extra costs on businesses with a payroll over £3 million, which can strain their resources.
- Inequitable Benefits: Larger companies may benefit more than smaller firms, creating disparities in access to training funds.
- Limited Training Scope: Companies might establish apprenticeships mainly to access funds, leading to inadequate training quality.
- Administrative Complexity: The process of accessing funds can be complicated and time-consuming, deterring participation.
- Quality Concerns: Focusing on increasing apprenticeship numbers could dilute training quality and effectiveness.
- Short-Term Focus: Companies may prioritize immediate job skills over long-term development, resulting in a skills mismatch.
- Labor Market Misalignment: Funded training programs might not align with actual industry skill shortages.
- Pressure on Providers: Increased demand can strain training providers, leading to longer wait times and reduced quality.
- Stigma: Apprenticeships may be viewed as less prestigious than university degrees, deterring potential candidates.
- Dependency on Levy: Businesses might rely too heavily on the levy for funding, undermining their independent training investments.
