Home Business Insights & Advice The great reset of the labour market

The great reset of the labour market

by Sponsored Content
12th Mar 21 12:49 pm

The Coronavirus pandemic has sped up many trends, one of which being remote work. However, it’s not just the switching from office to home which has caused a tremor in the labour market, but our belief in alternatives ways of working.

Since the start of the pandemic, there are 299,000 fewer 16 to 24-year-olds employed, with 148,000 fewer 25 to 64-year-olds employed. The difference between this economic downturn and an ordinary one is the way we spend our time. Locked in away from distractions, many have used this quiet time of self-reflection to retrain into another field.

There has been no better time historically to begin learning a difficult skill. Pubs, cafes, football stadiums, and most social interactions are all closed off. As a result, there has been a rise of internal recruiting, with employees keen on switching departments – particularly to facilitate cost-cutting practices.

Platforms such as Coachhub have done extremely well during the pandemic, where customers come for personalised online coaching. 45-minute video sessions allow users to tackle challenges in their life and work with professional guidance. Platforms like Coachhub are being used to leverage retraining and career development in a way that contradicts the oppression that coronavirus subjects us to.

Furlough, of course, has been another big factor in retraining. Unless Universal Basic Income is introduced, this will likely be the only time in most people’s lives where they can receive close to their full wage for a year without working. The breathing space this creates for focused skill development is extraordinary and allows the labour market to self-correct into equilibrium; supply can more quickly shift towards the ever-changing demand.

Markets driving markets

With the digitisation of business operations, many office workers will be having to re-learn some IT skills that they cannot depend on the IT department for. Not just the lack of physical presence from IT technicians, but the onboarding of new software to help ease the friction of working remotely.

Labour markets were already turning more towards computational skills, but the pandemic has certainly sped up these processes. Furthermore, it has spurred on a realisation that remote freelancing is incredibly accessible. Teachers who have spent the past few months teaching from their laptop at home are beginning to wonder why they couldn’t do this somewhere else in the world, and with their own clients.

The gig economy is something that is underrepresented in politics, however. Versatility brings with it a lack of security – no sick pay, no holiday pay, no maternity leave. A timely moment for the growing market of freelancers was Uber’s ruling, where the UK Supreme Court confirms that Uber drivers have workers’ rights, despite not being employed. This grey area may appear only unique to Uber, but it isn’t. Courier drivers, for example, will soon be asking for the same.

The ruling determined that Uber drivers were not self-employed, which keeps the precedent that freelancers should have no rights. Whilst this is an issue, it’s one step closer to addressing the grey area that exists – an inevitable gap to fill as more people become self-employed.

Where the UK goes from here is anyone’s guess. With an economic collapse in consideration, the UK government will feel that it has no more expansionary fiscal policy to offer, and no room left for interest rate cuts. With a labour market that is increasingly self-employed, this is more of a concern than otherwise, given the government’s responsibility is greater than ever.

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