Why do flexible work arrangements exist?

Datta, Nikhil (2024) Why do flexible work arrangements exist? CEP Discussion Papers (CEPDP2039). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

Text - Published Version Download (3MB)

• https://cep.lse.ac.uk/_new/publications/...

Abstract

This paper studies flexible work arrangements, with a focus on zero-hours contracts (ZHCs). Leveraging a unique dataset from a large UK firm in the low-pay sector, it provides novel descriptives on ZHC workers, as well as evidence on demand and supply side mechanisms for the use of ZHCs. The results show that ZHC workers experience significantly higher turnover rates and lower wages than permanent employees, and large heterogeneity in hours and earnings volatility. Causal evidence on the firm demand-side demonstrates that ZHCs help firms manage production and demand shocks. On the supply-side, ZHC roles attract 25% more applicants than comparable permanent jobs. ZHC roles are concentrated among specific demographics, and vacancy applicant and firm offer data demonstrates this is supply driven. Few ZHC workers apply for permanent positions and their decision to apply for a permanent position is wage insensitive. In contrast, permanent workers exhibit ZHC-wage elasticities that are an order of magnitude larger than those of their ZHC counterparts.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://cep.lse.ac.uk/_new/publications/discussion...
Additional Information:	© 2024 The Author(s)
Divisions:	Centre for Economic Performance
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HD Industries. Land use. Labor
JEL classification:	J - Labor and Demographic Economics > J2 - Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital; Retirement > J20 - General
Date Deposited:	10 Feb 2025 16:24
Last Modified:	10 Feb 2025 16:24
URI:	http://eprints.lse.ac.uk/id/eprint/126748

Actions (login required)

View Item