Agency workers and zero hours contracts the key to growth in 2014

RA Now

Flexible employment contracts will play a vital role in job creation and economic growth in 2014, research of UK employers has suggested.

The use of agency workers and zero hours contracts among other flexible contract options are either “vital” or “important” to the UK economy, according to 97% of the firms surveyed for On the Up, the CBI/Accenture Employment Trends Survey.

Such contracts enable companies to cope with fluctuating demand (87%), respond rapidly to growth opportunities (81%) and provide a stepping stone into work for those vulnerable to long-term unemployment (58%), as well as offering choice to those who don’t want full-time work (65%).

However there are threats to flexibility in the UK jobs market, respondents said. The burden of employment regulations (68%) and the loss of the UK’s Working Time Regulations opt-out (79%) risk having a negative impact on growth.

“Most businesses believe that flexible employment patterns, including agency and zero-hours work, are a critical tool when demand fluctuates and a firm needs to react quickly,” said Katja Hall,CBI chief policy director. “These contracts create opportunities for people looking for work that might not otherwise exist, and also attract investment to the UK.”

The study also found that most companies expect to create jobs than not over the next 12 months for the first time since the onset of the recession in 2008.

Fifty one per cent of firms expect their workforce to be larger in 12 months’ time, with private sector workforces anticipated to grow across all regions, with Yorkshire and Humberside and the east midlands the most buoyant.

“It’s good to see jobs being created across most regions, not just London and the south-east,” Hall added.

“Our labour market performed well throughout the recession and pay caution and flexible contracts will continue to underpin growth. For the UK to remain an attractive place to do business, as the recovery takes hold, wage growth must go hand-in-hand with growth in productivity.”