January WorkerTech Roundup

Welcome to 2025! We kick off the new year with forecasts from the Resolution Foundation that look at how fiscal and policy decisions taken at the end of last year might affect living standards through this one.

However, stories from the year just gone by linger on, as reports emerge of high street retailers having used questionable employment loopholes to hire seasonal workers as freelancers during the holiday season. Some of the retailers named (who have since abandoned the practice) may surprise you.

Lastly, we report on findings from the Pissarides Review – a three-year collaboration between the Institute for the Future of Work, Warwick Business School and Imperial College – researching the implication of automation on work, society and the wider UK economy.

Until next month,
Aish Moothan
Ventures Manager

New Year’s outlook from the Resolution Foundation

Economists at the Resolution Foundation released their forecast for living standards in 2025 this month, with a particular focus on those on low-to-middle incomes.

The headline: 2025 will be a year with a bigger role for the state.

Consumer confidence is low, GDP forecasts are low and so are net satisfaction levels with the current Government after their first 5 months in office. And yet, a milestone for this Government is raising living standards across the UK by the end of Parliament.

The Resolution Foundation forecast a fall in disposable incomes next year, in large part due to the £25billion in tax rises announced by the Chancellor that are scheduled to come into play next year. The Chancellor has implied that this is a trade-off that’s been made to fund improvements to struggling public services which in turn will lead to public benefit and an increase in living standards across the country.

Our Economists have come up with a measure of ‘broad living standards’ to test the above hypothesis and illustrate how this trade-off may play out over this year. The measure is the weighted average of disposable income (net wages, investment and benefits income after housing costs) and household benefits-in-kind (from using public services).

In 2025, the measure suggests that low-to-middle-income families benefit most from the investment in public services. This, however, is not the case for the poorest families whose loss in disposable income (due to rises in taxes and living costs alongside welfare cutbacks) outweighs any increase in benefits from public services. Higher-income households also face a gloomy outlook with a negative weighted average, as wages stagnate and interest rates pull income from savings down.

The government also seems set to expand its role in the economy, with our forecasts showing that public sector consumption is projected to rise to 26% of GDP by 2028-29, up from 22% in 2018-19. For investors and founders, this may indicate increased potential for public sector partnerships and a growing market for making public services like healthcare and education better and more efficient.

Looking ahead, the Foundation’s analysis focuses on GDP growth and productivity increases as the way out of the gloom. You can read the analysis in full and read more here.

High street went gig in 2024

As the shadow of Covid-19 and lockdowns was firmly left behind in 2023, millions of people returned to the high street to do their festive shopping last year. High street retailers in turn looked to hire seasonal workers to keep up with the increase in footfall from shoppers. In October of last year, 23,000 ‘Christmas’ jobs were on offer, according to job search platform Adzuna, with most vacancies being concentrated in retail and trade.

The most obvious difference between a ‘Christmas’ (temporary) employee and a permanent employee is that temporary employees will typically by put on fixed-term contracts. These contracts are regulated by the Fixed-Term Employees Regulations 2002 and entitles temporary workers to rights such as the national minimum wage, notice periods and paid holiday.

Last year however saw some employers seeking a new type of temporary worker, one accessed primarily through tech platforms and social media.

Household names that tend to popular with young people – such as LUSH, Urban Outfitters and Gymshark – were found to be recruiting ‘freelance’ staff through gig working apps to work in their stores during the busier festive period. Workers registered on such apps are deemed self-employed, and effectively excluded from the rights and protections they would have been afforded if hired as a temporary worker by the same employer.

Many of these ‘freelance’ workers are sourced through apps like Temper Works and YoungOnes and tend to be young adults. This is because such apps are being promoted on large social media platforms like TikTok and Instagram, by youth influencers with over hundreds of thousands of followers, an investigation by The Observer has found. Subsequent reporting by The Guardian shows that three of the retailers partaking in the practice have since stopped recruiting through apps such as YoungOnes and Temper Works, after an intervention by the Trade Unions Congress.

Worryingly, there are still some high-street retailers who have started to solely recruit ‘freelance’ employees through such apps, describing it as the way hiring is going to go in the future, according to this report by the Financial Times.

Making the future work for workers: Findings from the Pissarides Review 

Since 2021, the Pissarides Review has been researching the impact of artificial intelligence and automation on working lives across the UK. The initiative culminated in a closing conference in London (with satellite venues UK-wide) to discuss its findings and implications.

The Review highlights the uneven effects of technological disruption across the UK. While some sectors will experience job displacement due to automation, others will see new opportunities, growth and job creation, underscoring that tech-led change will be felt in complex ways rather than as a force of displacement (job losses) and enrichment (efficiency-driven profits).

Researchers also explored the relationship between technology exposure and worker well-being, subsequently advocating for a ‘capabilities approach’, which is a framework that focuses on how automation can expand workers’ choices, skills and quality of life. Adoption of such an approach is likely to inform policy and regulation as AI and automation become a larger part of our working lives.

The report emphasises that any potential benefit to be gained from technology will require substantial investment in workforce upskilling; it found that 20% of UK adults lack the basic digital and adaptive problem-solving skills necessary to navigate this technological transition.

The Review points towards the future opportunities of technologies that enhance job quality, support reskilling and education and workplace inclusivity. You can read all the insights from the Review here.

Get involved

Ufi VocTech Trust’s Activate grant fund is officially open for pre-application interest
Activate funds the development, testing and adoption of new digital tools and approaches that could reach learners furthest from opportunity, to ultimately transform learning for work. Start by checking your eligibility through their handy tool here. Applications close on February 4th.

Investment from Resolution Ventures 
Apply for direct investment from Resolution Ventures. We accept applications from WorkerTech ventures on a rolling basis. Or you can book a slot in our office hours for an initial conversation.