Record high for zero hour contracts

New analysis of Office for National Statistics (ONS) data reveals that the number of people on controversial zero hours contracts has reached a record high of 910,000.

This means that 110,000 more employees were working on the controversial contracts in 2016 compared with the same period in 2015, representing an increase of nearly 14 per cent. Put into clearer perspective, there were only 100,000 people on zero hour contracts in 2005.

However, the Resolution Foundation, which undertook the analysis of the ONS's Labour Force Survey, admit that the figures reveal a sharp slowing in the rate of increase in the last six months of 2016, with the increase of 0.8 per cent in the second half of 2016 comparing to a 7.6 per cent rise over the same period in 2015.

The charity pinpoints three possible reasons for the decline in the rate of increase. Firstly, as employment reaches record highs, jobseekers can become more demanding in the work and working contracts they seek. Secondly, the number of new jobs being formed are slowing.

Thirdly, business reputation could be an instigator in the decline, with large companies like Sports Direct attracting national headlines for its controversial use of the contracts. In recent months, DIY store Homebase scrapped zero hours contracts for its workers, while pub chain JD Wetherspoon offered thousands of its staff on zero hour contracts the opportunity to move onto contracts which guarantee hours.

Zero hour contracts should not be entirely dismissed though, despite their apparent unpopularity.

Conor D'Arcy, policy analyst at the Resolution Foundation, said: We shouldn't dismiss all zero hour contracts as exploitative. Over the past year, approaching half of the increase has been among workers aged 55-64. For many of these workers, zero hour contracts could offer a flexible transition from full-time work to retirement, allowing them to top up their incomes. Neither are they all low-paid positions: one in six workers on the contract are in the three highest-paying occupation groups."