How to create good work and inclusive growth in a 21st century economy
According to official government statistics, 2017 saw the British economy witness its highest period of employment since records began, with the lowest rate of unemployment recorded since 1975. It is a “jobs factory”, according to the Chancellor Philip Hammond. Yet if we dig a bit deeper the state of the labour market seems much more perilous.
Real wages continue to fall, and many of the new jobs that have been created are within the ‘gig economy’ – temporary or insecure work, which more often than not is low paid, and without the benefits more traditional employment contains (sick pay, holiday pay etc.). What does that mean for those in these jobs? Although ‘flexible working’ can be a benefit to some groups, such as students, their increased use appears to show a worrying development of whole business models circumventing employment taxes in a race to the bottom to achieve a ‘competitive edge’, representing a wholesale transfer of risk from employer to employee.
Turning jobs into ‘good work’
So how do we turn ‘jobs’ into ‘good work’? This concept is multi-dimensional, involving not just work but also social and personal factors – essentially the aim should be to create meaningful, fulfilling work with a strong purpose. The Taylor Review contained many ideas and recommendations to create good work, although as Taylor admits, these represent more ‘nudges’ than ‘shoves’. Whilst the government has not yet formally commented on the review, there is a policy vacuum from Westminster (see: the entire Social Mobility commission resigning over lack of progress). As a result, local areas are faced with a prime opportunity to lead by example and in doing so provide pressure on national policy makers; but how?
1. Create more and better jobs through the ‘real’ living wage.
For this, a change in rhetoric is needed – private firms will always view ‘doing your bit’ as a burden – if policymakers instead focus on ‘how will this benefit you?’ (stressing the many material benefits this can achieve i.e. lower sickness, higher staff retention etc.) better roll-out could be achieved;
2. Create more and better jobs through shifting behaviour, either on an industry- or area-wide level.
UNISON has developed an ‘Ethical Care Charter’, a set of standards for councils to stick to when they commission homecare services, and it has been adopted by several local areas. Many other local areas, from Salford to Croydon have adopted employment charters to promote socially responsible business and employment practices;
3. Creating more and better jobs through addressing the skills mismatch.
Tackling poor productivity and skills is the root issue of much low-wage employment. There is good practice visible within both the public sector (Oldham Council’s Career Advancement Service) and private (Unilever’s ‘Higher Apprenticeships Scheme’). Yet the government’s recent industrial strategy did not consider any form of subsidy for training to address clearly identified skill shortages;
4. Creating more and better jobs through collaboration.
Inclusive growth can be promoted by working with local anchor institutions to develop wealth within a local community. This approach has been proven to be successful in creating jobs and capturing more wealth locally in both the UK and the US.
These issues will only become more pertinent as the rise of artificial intelligence and automation means that we are heading towards a future of fewer jobs and an increase in the concentration/power of capital. Work used to be the best route out of poverty and means to acquire wealth. How then should we restructure our society with lower levels of work to capture wealth and distribute it in the most socially just way?
There are a range of policy prescriptions to ensure ownership and financial return on investment is broadened and deepened, rather than narrowly held by a few. This includes a reinvigoration of the idea of ‘the commons’, as advocated by CLES and a range of broad based ownership models. This includes:
- Expansion of employee stock ownership plans (ESOPs)
- Encouraging the growth of many types of co-operatives
- Increasing municipal ownership as advocated by CLES (here) and in CLES’ submission to RSA Inclusive Growth Commission
The Scottish Government has also committed funding to pilot universal basic income, an idea that was once viewed as (and perhaps still is) a radical idea.
Whatever specific policy mix is ultimately taken forward in any locality, we must ultimately recognise the value of ‘good work’ – not just as an aim in its own right, but as a key pivot of local areas’ broader economic and social aspirations.