Nearly 60% of British children who fall below the poverty line live in households where at least one adult is in work. Children growing up in poor households are more likely to have poor health, to perform badly at school, to become teenage parents, and to come into early contact with the police.
This costs us all in many ways. Shamefully, we also have the largest gender pay gap in the EU, and two thirds of low paid workers are women, meaning poverty in the UK has a female face. Thousands of people are known not to be receiving even the minimum wage of £5.80. And yet poverty experts report that a single adult, working full time, needs to earn at least £6.88 an hour to reach the most basic weekly standard of living; and much more in cities like London. Read more »
Today’s Friday film comes from the Fair Pay Network, a coalition of 15 organisations (including the TUC), looking to raise awareness of the issue of poverty pay during the run up to the election. Read more »
The severe recession precipitated by the banking crisis of 2008 means the economy is likely to dominate policy debate in this election to a much greater extent than for any election since 1992, or even further back. But how will the economic crisis affect people’s views on the way the economy should move forward?
For thirty years, the mainstream economic orthodoxy was that the way to economic success lies in deregulating product, labour and financial markets as much as possible. Given that the banking crisis was an object lesson in how deregulation could, in some circumstances, deliver not economic success, but instead near-armageddon, we might have thought that this would lead to some reconsideration of whether deregulation was always and everywhere the best policy after all.
However, the proponents of deregulation – including the Conservative party (but also some leading politicians in the Liberal Democrats and Labour parties), business groups such as the Institute of Directors, Confederation of British Industry and British Chambers of Commerce, and right-wing think thanks such as the Institute of Economic Affairs have instead insisted that the economic crisis means we need to deregulate still further, particularly in the labour market. Read more »
There has never yet been a minimum wage increase that has failed to provoke dire prognostications from some employers groups and today was no exception. Last autumn we once again saw employers’ groups lining up to argue that the minimum wage should be frozen.
Leaving aside the question of why low paid workers should have to bear a disproportionate part of the cost of the economic mess created by super-rich city bankers, what we have here is a clear case of the sum of individual wisdom adding up to collective foolishness. Of course some employers don’t want to pay their staff more, but they certainly all want their customers to spend more. In fact, minimum wage workers are most likely to spend 100% of any pay increase, thus generating a modest fiscal boost to the economy. Read more »
There are many causes behind migration. One of the commonest cited is skill shortages. But as liberal economists argue, that’s often a misnomer. All that is in fact happening is a wage shortage: raise the wages and sufficient skilled workers will appear. Today, the Chartered Institute of Personnel and Development (CIPD) and KPMG have issued a report today which suggests the liberal economists are right. They say that employers facing skill shortages would employ more British workers if they could pay them less (rather suggesting the skills are available, but at a price employers don’t want to pay).
Exploiting migrant workers to undercut the existing workforce simply sets worker against worker. And whilst employers may benefit in the short run from lower wage costs, the BNP are more likely to be the long term beneficiaries.
Instead, unions have been arguing that paying migrants the same as the existing workforce (and giving them all the other rights we have won over the years) is the best way to combat exploitation, undercutting and racial strife. The national minimum wage has had some effect in making undercutting less possible, but the CIPD take potshots at that, too. Read more »
The rise in the minimum wage announced today is small but it is a rise. The strenuous megaphone lobbying by the business associations to freeze the minimum wage (covered elsewhere on this blog) was faced down. An extra £2.45 per week for a full-time minimum wage worker isn’t a lot but the mean-spirited and economically myopic bunch at the CBI and British Chambers of Commerce would have had it at £0.00p. So a small glimmer within the gloom.
