The dominant approach of policy-makers to the labour market, to working life and to unemployment is no longer fit for purpose. We continue to use the policies and withering infrastructures of post-war industrialism, whilst the composition of the workforce, the nature of jobs themselves and the productive powers available to us have drastically changed. We need to move toward a new settlement in order to secure out-of-work security and in-work prosperity.
If ‘hard work’ at your job ever guaranteed an improvement in your situation, this is far from assured today. The share of national income going to wages and salaries is in decline while the share going to capital is expanding, meaning that simply owning assets such as shares or housing is a more expedient route to economic success. Recent research has shown that over time and across the globe, a higher capital share (and lower labour share) is linked with higher inequality in terms of the distribution of personal incomes. As it stands in the UK, ten percent of the population own fifty percent of private wealth. Unsurprisingly, some are calling this new economy ‘rentier capitalism’, wherein value is extracted rather than created and where ‘work does not pay’. The deployment of automation technologies over the next few decades, if left unchecked, will most likely exacerbate this inequality.
Workers are not getting their due in other, more subtle ways too. They put in large amounts of unpaid overtime ; are commuting for longer than they were ten years ago ; are earning less in real terms than they have for over a decade ; and are suffering remarkable levels of in-work poverty. The amount of precarious jobs – those which cannot guarantee a secure livelihood – has risen sharply this century, with over one million zero-hour contracts deployed in 2017. We have also seen a drastic increase in the amount of people now drifting in and out of work in the UK. Since 2006 we have seen 60% more people move between a job and unemployment, propagating a ‘low-pay, no-pay cycle’. Consecutive, regressive labour legislation such as the Employment Act (1980) and the Trade Union Act (1984), as well as the present failure to clamp down on bogus self-employment, have contributed to the neutering of worker power and have allowed the above scenarios to emerge. It has been estimated that the UK is the country with the second lowest level of collective bargaining coverage in Europe. Today, some have estimated that the coverage is now less than 20%, in comparison to coverage of above 70% in the 1960s and 1970s . This decline has been facilitated in large part by hostile policy: even Tony Blair once remarked that British law on trade unions is the “most restrictive in the Western World”.
