Thursday, November 13, 2014

Four reasons for the UK's "economic recovery": low-skill work, zero-hour contracts, internships, and "self-employment"

The Conservatives are magicians: managing to create an economic recovery with more jobs that still leaves people worse-off than before. How on earth do they do it?

The answer is simple, and boils down to the changes that have happened in the UK's labour market since the Conservatives took office in 2010. In short, Britain doesn't have a smart labour market, or a very efficient workforce; it has a "stupid" labour market, and a "useless" workforce.

Work smart, not long?

When I say "stupid" and "useless", I'm not criticising employees; on the contrary, they are doing the best they can in an employment situation designed to frustrate and degrade them. My beef is with how the government and British employers have created a  hollowing-out the labour market in the middle: the number of semi-skilled jobs is disappearing quickly, often being replaced by technology; and the number of low-skilled jobs is on the rise to compensate for this.

Britain has some of the lowest work productivity rates in the Western world. Along from the mass of low-skilled jobs that are proliferating (Aldi expansion coming your way?), semi-skilled jobs are disappearing (Lloyds recently announcing mass layoffs, as did Rolls-Royce's aviation wing - ha-ha).
The low productivity comes from the long-hours culture that has been around for decades, and seems to be getting worse; with fewer jobs and more competition for work places, employers hold the whip hand ever more, obliging workers in offices and elsewhere to work overtime in order to keep their masters' happy. This is a disaster in the long-run, and simply becomes a race to the bottom, declaring that Britain is on a fast-track to being ran like a developing country.

For the UK to put this right looks like it would require a whole paradigm-shift, and a near-rejection of the established orthodoxy of Anglo-Saxon capitalism. In short, nothing would appear to be changing soon, and may be worse if people like Ukip have their way.

"Employee rights"? What are they?

One stark fact that has gone habitually under-reported is the slow destruction of employee rights. While the minimum wage is a legal working requirement, how many times has is been seriously enforced?
Especially with the crowded labour market for low-skill jobs, and more and more people looking for jobs that offer worse conditions - it is this power that employers have that explains much of the rise of zero-hour contracts (which legally bind you to an employer that has no obligation to give you fixed hours of work). Those jobs that are in the more skilled sectors now like to offer internships as a way to give graduates "opportunities" (we are awash with euphemisms these days!), but are more simply unpaid work that only people from wealthier families can really afford to "invest" the time in. The irony here is that many of these so-called internship "opportunities" are used by employers to get graduates to do dull errands and menial tasks for a few months for free, then hire another sucker to replace them. Ah, what a life!

Lastly, there is the quiet rise of the self-employed - in, put in other terms, a rise of those in the utterly desperate, last-chance saloon. These poor people are often reduced to debt-filled penury, after bravely trying-out a venture that doesn't work out (thanks to George Osborne's "Wonga" economy).

This is the future that the Conservatives promise Britain: more of the same, failed ideas with the same intellectual pygmies that have no qualifications to run the economy: turning it into a glorified PLC, lapping-up the many migrant workers from Eastern Europe that can swamp the growing low-skill economy, bringing wages down further, and encouraging companies to offer worse and worse working conditions. In this economy, the only things growing will be inefficiency, food banks. and wealth disparity.

If you like the sound of that, though, then you should probably vote Conservative.

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