THE BLOG
12/07/2018 15:55 BST | Updated 12/07/2018 15:55 BST

Brexit Is Making Us Blind To The Real Jobs Crisis

The response to this dawning new era of mass redundancy has been building slowly in recent years, but arguably in the wrong direction

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With more twists than many a TV soap opera and implications that will live with us for generations, it’s not surprising our public discourse is fixated on Brexit. But is it making us ignorant of the macrotrends that will have far greater consequences in the long run?

Brexit may well be a needless act of national self-harm. But even the staunchest Remainer would probably accept that, while the short-term hit from whatever eventual deal is hammered out is likely to be painful, Britain’s economy will survive, albeit in a weakened state.

And while currently there seems to be no end in sight, we will eventually move on from Brexit. At that point, the need to address the other global issues affecting the prosperity of everyone will be even more acute, consumed as we have been by national introspection for so long.

We certainly have our work cut out. At least that’s my reading of some of the findings in the latest British Social Attitudes Survey. For, buried beneath the shifting views about the wisdom of leaving the EU are some fascinating insights on public perceptions about the future of work – an issue where we stand on the precipice of far-reaching change.

The survey found that while 75% of people think machines or computer programmes will definitely or probably do many of the jobs currently done by humans, just 10% of workers are worried that their own jobs will go. The disparity looks like mass denial, or at least a mental disconnect with the consequences.

It probably doesn’t help that economists themselves are divided on the impact of automation and artificial intelligence (AI). Some believe the negative impact will be more than made up for by increases in productivity and overall economic growth. Others posit that, with investment in skills and retraining, workers can be redeployed in higher-skill sectors.

But even if those arguments prove correct, the technological currents already sweeping through global economies may simply overtake our capacity to adapt. While the robots may be much more efficient than human beings in generating economic output, the dislocation to individuals and communities is likely to be profound. And we know from bitter experience how lofty pronouncements on upskilling the workforce too often fade away with precious little to show for themselves.

A report last year by the consultancy PwC found that up to 30% of British jobs – 10 million - could be automatable by the mid-2030s. And earlier this year, the Centre for Cities put the job losses figure in our major urban centres at 3.6 million – but warned the impact in some parts of the North of England could be as high as one in three.

What’s clear is that the impact will be felt most keenly in the lower-skill, lower-pay sections of our economy where job insecurity is already the new normal. In fact, while workers overall appear unfazed by automation, among the lowest paid there is widespread concern about the precariousness of their employment right now. According to the survey, 37% of people earning less than £1,200 per month fear they’ll be out of work in 12 months’ time and 15% can have their hours changed at short notice.

The response to this dawning new era of mass redundancy has been building slowly in recent years, but arguably in the wrong direction. The fashionable idea of a ‘citizen’s income’ – where people are paid a flat stipend by the state – has been winning devotees including Facebook’s Mark Zuckerberg and Tesla’s Elon Musk. This is despite its very obvious flaw: it would consume a vast chunk of government spending from a (presumably shrinking) tax base.

This is in part why, last year, I led a team of economists including Professor Jonathan Portes of King’s College London to publish proposals for an alternative idea we call ‘universal basic services’. Rather than handing people a flat cash sum, this plan would see public spending used to make a range of services including transport, food, housing and internet technology free at the point of use, along the same lines as the National Health Service. Under our modelling, the £42billion cost – a tiny fraction of a modest citizen’s income - could be fiscally neutral with changes to the Personal Tax Allowance while delivering a highly progressive cut to the cost of living benefiting the lowest paid most.

While derided by some as utopian, these ideas are percolating into the mainstream. On July 1st, for instance, Estonia became the first country in the world to introduce free bus travel across its entire territory. The Baltic nation sees the move as a way of boosting not just personal mobility, but tourism and economic growth.

An enhanced safety net like this, however, is only part of the solution we need. Work remains of fundamental importance to people’s health, wellbeing and self-identity. Developing a true national strategy for dealing with the seismic shifts already happening around us means tackling the democratic deficit that leaves many people disengaged from the debate at present.

This is a phenomenon that’s going to affect all of us, in whatever sector we work in. So we all have a stake in finding a path towards a working future that doesn’t accept inequality and mass un- or underemployment as collateral damage.

The fear is that continued Brexit-induced inertia in government and across civil society will continue to see any serious debate filed away in the ‘too hard’ tray until that damage is done.