Insecure work: Breaking the cycle for a thriving workforce

Work in the 21st century has become a constant balancing act of insecurity for millions of people across the world. Research indicates that economic crises, such as the COVID-19 pandemic, have exacerbated job insecurity, leading to adverse psychological outcomes for employees. In Saudi Arabia studies during the pandemic found that job insecurity is linked to increased financial anxiety and decreased work-related flow, impacting overall employee wellbeing. Meanwhile in Bangladesh research found that job insecurity contributes to mental health issues, including anxiety and depression, among workers

In the UK one in five workers faces a cocktail of low pay, erratic hours, insufficient protections and little room for career advancement. These aren’t just abstract statistics – they represent a structural issue disproportionately impacting women, ethnic minorities disabled workers and young people.

And this insecurity isn’t a standalone problem. It coincides with a workforce that is shrinking and becoming sicker. The UK stands alone among G7 countries in having fewer workers today than before the pandemic, while employers in critical industries like health, social care and hospitality face debilitating labour shortages.
A recent report published by UK’s The Work Foundation, No Progress? Tackling Long-Term Insecure Work, highlights the lack of job security, limited progression and health impacts associated with insecure roles. It notes that to combat this we need to look beyond sheer numbers and confront an uncomfortable truth: poor-quality jobs are an anchor, not a springboard, to a thriving workforce.

In this article we examine key findings from the report, identify the demographics most affected by insecure work and offer solutions to break the cycle of instability for a sustainable workforce.

Understanding insecure work

What is insecure work? 

Insecure work is defined by a combination of contractual and financial instability. This includes roles that do not guarantee future work, offer low and unpredictable wages or lack basic employment rights. The No Progress? report categorises insecure work based on The Work Foundation's UK Insecure Work Index, which identifies workers who face insecurity across multiple dimensions.

Who is most affected? 

Certain demographics are disproportionately impacted. Women, ethnic minorities, disabled workers and young people are more likely to find themselves in insecure roles. The report reveals that about 20% of UK workers, equivalent to 6.8 million people, are classified as being in severely insecure work. This high percentage reflects underlying structural issues in the UK’s labour market, such as gender and racial inequalities.

The insecure work trap

Is insecure work a stepping stone or a trap? 

For many, insecure work has been framed as a potential stepping stone to more stable, better-paying roles. However, findings from No Progress? suggest the opposite. Over a four-year period, four in 10 people (44%) who were in insecure work remained stuck in similar roles, indicating that for a significant portion insecure work becomes a long-term trap rather than a pathway to security. In contrast, those who began in secure work were far more likely to sustain that stability, with 79.5% still in secure roles four years later, compared to just 39.5% of those who started in insecure roles.

The myth that ‘any job will do’ collapses under the weight of this evidence. Workers in insecure jobs face persistent barriers, from volatile income streams to limited access to training and career progression opportunities. For many, these obstacles prove insurmountable without systemic intervention.

Stuck in the wrong sector

Sector immobility is another key finding. Insecure workers were nearly three times more likely than their secure counterparts to switch sectors – typically fleeing industries rife with precarious work, like social care, retail and hospitality. 

Older workers are particularly vulnerable. The data shows that opportunities to change occupations or sectors narrow significantly with age. Workers aged 45-54 are almost twice as likely to remain stuck in insecure roles as those aged 16-24 (48.8% vs 28.2%). This raises critical questions about age-related barriers to progression and underscores the need for targeted interventions to support mid-career workers.

Health impacts of insecure work

How does insecure work affect health? 

The report highlights a concerning link between insecure work and declining health outcomes. Workers in insecure roles face higher risks of health issues, largely due to the stress and anxiety associated with job and income instability. In fact, insecure workers are 1.4 times more likely than those in secure roles to experience involuntary worklessness due to ill health.

This trend is especially concerning for those already managing health conditions. The report finds that insecure workers with existing health issues are twice as likely to become unemployed or economically inactive as those without health conditions. The connection between insecure work and ill-health is a feedback loop. Poor-quality jobs can exacerbate stress and health conditions, while ill-health can further limit a worker’s ability to find stable, sustainable employment. Breaking this cycle requires action that addresses both job quality and workforce health simultaneously.

Broader societal implications

The rise in work-related health issues has a ripple effect on society as a whole. The UK currently faces a significant labour shortage, partly due to increased economic inactivity from long-term health conditions. As workers cycle in and out of insecure roles healthcare demands rise, putting further pressure on the National Health Service (NHS) and increasing welfare costs. This suggests that improving job security could benefit not only individual workers but also the broader economy.

Breaking out of the insecure work cycle

What are the barriers to progression? 

The No Progress? report identifies several obstacles that prevent insecure workers from advancing to more stable roles:

• Sectoral traps: Certain sectors, like social care and retail, have a high prevalence of insecure work with limited career advancement opportunities.
• Lack of training and development: Workers in insecure roles often lack access to the training needed to build skills for higher-level positions.
• Financial instability: The unpredictable nature of insecure work means that many workers lack the financial stability needed to invest in career development.

Switching sectors as a solution

One of the report’s key insights is that changing sectors can significantly improve a worker’s chances of finding secure employment. For instance, 78% of insecure workers who left the health and social care sector obtained secure work, compared to only 59% of those who remained in the sector. This suggests that policy efforts should focus on facilitating sectoral mobility, making it easier for workers to transition into roles with better long-term prospects.

Recommendations for reducing insecure work

The solution isn’t just about creating jobs – it’s about creating good jobs. The upcoming UK Employment Rights Bill is an opportunity to lay the groundwork for meaningful reform, but incremental changes won’t cut it. 

1. The Employment Rights Bill

The new Employment Rights Bill, expected to become law next year, seeks to address job insecurity by:

• Giving workers more control regarding zero-hour contracts and exploitative employment practices like “fire and rehire.” Employees will have the right to reasonable notice of shifts and a contract with guaranteed hours, while It will be automatically unfair to dismiss employees for refusing a contract variation, except in exceptional circumstances.
• Employers will need to justify refusing requests for flexible working.
• Abolishing the two-year qualifying period for unfair dismissal claims. Employees will be protected from unfair dismissal from the first day of employment, with the exception of a potential probationary period.
• Establishing a Fair Work Agency to ensure compliance with labour laws and improve job quality across sectors.

These measures represent an important first step, but the report emphasises that they alone are unlikely to eliminate long-term insecurity. For a lasting impact additional strategies are needed to raise the quality of jobs in high-risk sectors.

2. Establishing a Secure Work Commission

The report calls for the creation of a national Secure Work Commission to monitor and improve access to secure employment. This body would bring together government officials, employees and labour unions to set targets and implement changes in sectors with high levels of insecure work. The commission’s responsibilities would include:

• Publishing quarterly data on the state of insecure work to identify areas for improvement.
• Working with large employers to conduct assessments of their employment practices.
• Partnering with industry leaders in sectors like social care and retail to develop better career pathways.

Key takeaways for workers, employers and policymakers

For workers: Workers in insecure roles should consider exploring opportunities in sectors with higher job stability, such as education, transport and real estate. Additionally, taking advantage of available training and skill-building programs can open doors to secure roles.

For employers: Employers can help address job insecurity by offering more predictable hours, fair wages and clear progression pathways. Doing so can improve retention rates and build a more resilient workforce.

For policymakers: The UK Government has an opportunity to tackle insecure work through policies that go beyond short-term job placement. By creating a supportive infrastructure for secure work the Government can help build a labour market that promotes long-term stability and economic growth.

Insecure work solutions across the world

Job insecurity is a global concern, with various countries implementing strategies to address it. The UK can draw valuable lessons from these international approaches:

1. Denmark's Flexicurity model

Denmark's flexicurity system combines labour market flexibility with robust social security. This model allows employers to adjust their workforce as needed while providing employees with strong unemployment benefits and active labour market policies, facilitating swift transitions between jobs. The model comprises three key elements: 

1. Employers have the freedom to hire and dismiss staff with minimal costs, and dismissal litigation is rare.
2. Workers paying into an unemployment insurance fund receive up to two years of unemployment benefits if they lose their jobs.
3. The Government provides robust support for the unemployed, including education, retraining and counselling to facilitate rapid re-employment.

Additionally, the state offers subsistence payments for those ineligible for other welfare schemes, such as pensions or unemployment benefits, due to illness, divorce or job loss. 

2. Germany's Kurzarbeit scheme

Germany's Kurzarbeit (short-time work) programme enables employers to reduce working hours during economic downturns, with the government compensating employees for lost wages. Under Kurzarbeit the Government normally provides an income “replacement rate” of 60% (more for workers with children). That is, a worker receives 60% of his or her pay for the hours not worked, while receiving full pay for the hours worked. So, for example, a worker would only experience a 10% salary loss for a 30% reduction in hours. The programme usually runs for a maximum of 6 months consecutively. This scheme has been credited with preserving jobs during crises, such as the 2008 financial downturn and the COVID-19 pandemic. 

3. The Netherlands' Balanced Labour Market Act

The Netherlands introduced the Balanced Labour Market Act in 2020 to reduce the disparity between permanent and flexible employment. The legislation aims to make flexible work less attractive to employers by increasing social security contributions for temporary contracts, thereby encouraging the offering of permanent positions. It includes:

• Limiting labour agreement duration: Employers can offer up to three fixed-term contracts within 36 months before they must convert to an open-ended contract (previously 24 months). Collective labour agreements can extend or modify these terms.
• On-call worker protections: After 12 months on-call workers must be offered a fixed-hours contract reflecting their average hours worked over the past year. Employers must provide at least four days’ notice for shifts, and workers can refuse last-minute changes or cancellations.
• Unemployment insurance premium changes: Lower premiums apply to open-ended contracts compared to fixed-term ones, incentivising employers to provide permanent roles. Premium reductions also apply to young workers under 21 working fewer than 12 hours a week or those in vocational training.

What HR leaders can do to break the cycle of insecurity

While systemic reform is essential, HR leaders are uniquely positioned to drive change from within their organisations. Addressing job insecurity isn’t just a matter of corporate social responsibility; it’s an economic imperative. A more stable workforce translates to higher productivity, lower turnover and better organisational resilience. Here are four ways HR professionals can lead the charge:

1. Redesign work for stability and predictability

One of the biggest challenges in insecure work is unpredictability. HR teams can:

• Offer minimum guaranteed hours, even for part-time or shift-based roles, providing employees with a baseline income they can rely on.
• Implement predictive scheduling to give workers advance notice of shifts, minimising the financial and emotional toll of last-minute changes.
• Eliminate ‘on-call’ expectations unless compensated and agreed upon, fostering a culture of respect for employees’ time.

2. Prioritise workforce health and wellbeing

Given the clear link between job insecurity and health, employers should:

• Create a culture of wellbeing where people feel that leaders and managers create an environment that is supportive, positive and safe.
• Implement policies and practices that support wellbeing and ensure your people have the knowledge and confidence to take ownership of their own wellbeing and those around them.
• Build a culture of open communication, where employees feel safe discussing health challenges without fear of discrimination or dismissal.

A healthier workforce is more productive and engaged, and reducing the stress associated with insecure work pays dividends for organisations and employees alike.

3. Challenge Sectoral Barriers from within

In industries where insecure work is pervasive HR can lead efforts to reshape norms. This includes:

• Collaborating with industry bodies to standardise best practices for job security and worker progression.
• Advocating for fair pay and benefits across supply chains, ensuring that outsourced or temporary roles align with organisational standards.
• Leveraging purchasing power to encourage suppliers and contractors to adopt secure work practices.

These actions demonstrate that individual organisations can influence sector-wide change, even without waiting for government mandates.

4. Measure and share progress

Accountability is crucial. HR teams can:

• Track metrics on job quality, retention and employee satisfaction to identify areas for improvement.
• Publish data on workforce security as part of ESG (Environmental, Social, Governance) reporting, signalling a commitment to social impact.
• Engage employees in surveys and focus groups to co-create solutions and refine initiatives based on real needs.

This approach not only holds organisations accountable but also builds trust and transparency with employees and stakeholders.

Conclusion

The UK’s workforce isn’t just shrinking – it’s fraying at the edges. Insecure work erodes living standards, damages health and weakens economic resilience. If the Government wants to address labour shortages and improve economic growth it must confront the deep-seated issues of job insecurity. The evidence is clear: security, not just employment, is the foundation of a thriving workforce. Without bold action the UK risks condemning millions to a future where work is defined not by opportunity but by uncertainty.