Employment: The Balance of Uncertainty in Times of Economic Turbulence

While full-time work is generally protected by employment law, self-employment or on-demand work is more vulnerable to a sharp drop in demand.

When a recession hits, employers can lay off short-term contracts or casual workers more easily than they can lay off full-time employees.

As a single parent, I always have to be creative to generate income when needed – On Mar Win Family Time.

Parker says, “I’ve had the opportunity to be full-time, but generating my own income and having the freedom to make choices has been so rewarding. These past few years have been priceless: I’ve been able to help raise my young child, which otherwise wouldn’t have been possible in a nine-to-five office job.”

However, other workers find themselves in unsafe work due to imposed conditions.

This can occur in industries such as hospitality, transport and the arts, with zero-hours contracts and on-demand work typically occurring in the service sector.

In these cases, low-wage employees do not have a guaranteed income and often do not benefit from paid vacations or sick leave.

As the role of technology has grown, so has the role of precarious employment in the economy.

Figures of exact numbers vary; According to a 2017 estimate by the United States Bureau of Labor Statistics, agency work, on-call work, contract work, or freelance work is the primary source of income for more than 10% of American workers.

In the UK, the June 2022 report showed 3.7 million workers were in precarious work; Those on zero-hours contracts are defined as agency workers, casual and seasonal workers and low-paid self-employed workers (but not workers on fixed-term contracts).

People are increasingly turning to stage jobs to bridge income gaps; According to a 2021 survey, 16% of American workers have earned money from an online gig site at some point, favoring younger, lower-paid workers.

Freelance designer On Mar Win, 46, relies on platform work.

Although frequently commissioned by global brand clients on projects ranging from food packaging to book illustrations, he says more than half of his income comes from teaching art classes online through the learning platform.

“As a single parent, I always have to be creative to generate income when needed.”

Based in Hertfordshire, England, Winn says she is deeply concerned about how the recession will affect her work.

”A perfect storm is brewing between cost-of-living pressures and financial uncertainty. Almost everyone is going to be tightening their belts, which means there may be less consideration for online learning.

Without full-time jobs to rely on, workers in precarious employment face a range of pressures from which regularly employed colleagues are better protected.

Parker says the economic downturn means many freelancers are now feeling more pressure to do as much work as possible.

Saying yes to extra work creates a form of security, he explains; This means more wealth accumulates during recessions, but workers are not dependent on a single income.

However, this type of financial planning is not without consequences. “After losing contracts, independent marketers may have taken on more work to overcompensate,” says Parker.

“Those who have lost big jobs have taken up three or four contracts, despite only employing one or two people. We may be overworked – and burn out – but at least we fail if something goes wrong. ”

Overwork is one of the ways that workers in precarious jobs try to cope with stressful uncertainty.

In general, says Chia-Hui Wu, professor of organizational behavior at Leeds University Business School, UK, a lack of financial stability can take a huge psychological toll on the self-employed.

His 2020 research of 1,046 workers in Australia showed that those who experienced chronic job insecurity, which he defined as four or more years of high job insecurity, were more likely to experience personality changes that affected their mental health.

“The experience of chronic job insecurity can affect personal well-being by undermining a person’s social and professional life,” he says.

“Over time, these workers became more depressed and neurotic, and less pleasant and conscientious.”

Financial stress can increase during economic downturns, Wu says, and workers in precarious jobs may also lack a support network in the workplace.

“The transactional nature of secure employment leaves workers in charge of managing their long-term goals or career plans. It can be uncertain when a freelancer might receive a request or a contract, creating a psychological pattern of perpetual waiting for jobs.

Without sick pay or annual leave, it is difficult for these workers to completely separate themselves from work, which affects their health and well-being. In fact, research shows a link between precarious employment and poor health.

After losing contracts, freelance marketers may have taken on more work to overcompensate – Ryan Parker

In a recession, some workers in precarious jobs will suffer more than others.

For example, knowledge workers may be able to move into a full-time job or have marketable skills that pay well.

Conversely, gig workers and those on zero-hours contracts, who are in jobs that are unnecessarily risky rather than elective, are more likely to already be in financial trouble and have fewer options during a crisis.

Winn has been in insecure employment since the 1990s. If fall bites, he says he can diversify his salary by explaining it through virtual workshops and accumulated passive income.

“My first passive income, selling doodles on a stock image site, was a direct result of needing to earn an income. It took two years to build, but it paid off. [Depuis] I’ve done everything, buy and sell on eBay, cook from scratch, and walk everywhere [pour économiser de l’argent].

Over time, he says, he has built psychological toughness in the face of economic booms and busts.

”I remember when my children were young, how little we lived on and it affected my mental health – we were constantly in debt.

After years of living in danger, I’ve developed a certain resilience: I have the ability to think strategically rather than panic.

But that may not be the case for everyone, especially younger workers or those with limited sales skills.

Many people in precarious jobs will worry too much about what the coming months will bring – and that can harm their financial stability and well-being.