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‘Job churn’ and ‘precarious work’ don’t have to be the new normal

Fiona McQuarrie is associate professor in the school of business at the University of the Fraser Valley

Prime Minister Justin Trudeau and Finance Minister Bill Morneau have both recently told workers that they need to get used to "job churn" and "precarious work." They were referring to the increasing prevalence of short-term, non-permanent jobs in the Canadian labour market.

But it's a mistake to treat this as a norm we have to accept. Federal and provincial governments can change this situation and reduce the negative effects of uncertain work arrangements.

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Organizational theorist Chris Grey points out that the structures of markets and organizations are not dictated by unknown, uncontrollable forces. They exist as they do because of decisions made by people. Obviously, a complex system such as a national labour market is affected by multiple decisions made over extended periods of time. But governments can make choices that affect the employment opportunities available to Canadians.

For 40 years, full-time work has represented 52 per cent to 58 per cent of employment in Canada. However, there has been a steady decline in the numbers of young workers (between the ages of 17 and 24) and men working full time. This decline is usually attributed to fewer jobs in goods-producing industries and more jobs in service-based industries, where part-time and non-permanent work arrangements are more common.

And as a result of globalization and increased competition, organizations are under greater pressure to grow and to produce profits more quickly. Labour costs are a significant operating expense, so these become a prime target for cost containment. Organizational growth and profitability are easier to achieve when part-time or non-permanent work arrangements allow employers to adjust the size and use of their work force as needed.

However, job churn and precarious employment incur other costs. High turnover requires employers to continually invest in recruiting, hiring and training. Employees relying on part-time or precarious work suffer stress from struggling to meet living expenses; they are usually unable to make major financial investments such as buying real estate or saving for retirement.

It's been argued that workers, particularly millennials, want flexibility in jobs and careers – but workers taking part-time or short-term jobs may be doing so because they have no alternative.

Employers' and employees' attitudes toward each other also play into this. The "psychological contract" model suggests that employee-employer relationships are based on reciprocal unspoken expectations. Employers expect employees to be productive and to be committed to the organization, and employees expect to be treated fairly and with respect. Canadian employee engagement rates have stagnated or worsened as the amount of precarious work in Canada has increased, so it is not unreasonable to suggest that Canadian employers relying on precarious work arrangements may be perceived by employees as not worth their loyalty. That, in turn, may cause more turnover or dissatisfaction.

Governments cannot dictate the kinds of jobs employers offer, but governments can certainly incentivize employer behaviour that facilitates stable employment. For example, tax benefits or subsidies for employers can be linked not only to the numbers but the types of jobs created.

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Strong labour codes and employment standards legislation, and adequate support for the monitoring and enforcement, can discourage employers from using temporary or part-time work arrangements to undercut permanent full-time jobs, or from unduly exploiting precarious workers.

There will always be a need for flexibility. It's unrealistic to expect job churn and precarious employment to completely disappear. But telling workers to get used to these arrangements is the wrong approach. Governments can make choices that will support stable, reliable jobs. Doing so will improve Canadians' working lives, build healthy communities and economies and make a better society.

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