THE BLOG
23/08/2018 17:20 BST | Updated 23/08/2018 17:20 BST

Why I No Longer Care About Unemployment Stats – And Why You Shouldn’t Either

The decline of unemployment is a side-effect of insidious labour-relations which have hit Britain’s poorest the hardest

B&M Noskowski via Getty Images

With unemployment figures continuously dropping since 2011 it might be easy to have an optimistic view of the UK economy. However, once looking at the nuances that have allowed unemployment to become so low it is arguable that the decline of unemployment is a side-effect of insidious labour-relations which have hit Britain’s poorest the hardest.

First, it is important to point out the overwhelming amount of in-work poverty and homelessness. More than half of homeless families and over 2/3 of families in poverty are in work. Both figures have increased dramatically since 2011 and along with increasingly expensive living costs, the changing nature of employment has helped amplify the unaffordable climate the UK economy has created for its poorest.

Employment patterns show a clear trend. Part-time work, zero hour contracts and phony self-employment (Uber, Deliveroo, etc) are continuing to make a significant part of the labour force. With this comes the issue of inadequate hours and precarious protection. Of course, there are some people that want to be employed under these contracts but still, over a decade later, we are yet to fall below the pre-financial crisis proportion of people who are involuntarily in part-time work; there are still many people who would take full-time work if it were available to them.

With this in mind it can make focusing on unemployment seem meaningless. Over a decade ago it may have been less contentious to say that employment was the best route out of poverty but now in 2018 it seems far from the case. While the average salary fails to rise with inflation but CEOs’ pay rises at 6x the pace there is evidence of systemic inequality, that not only seems deeply unfair but is keeping many of Britain’s workers in poverty or even homeless.

The trend in employment shows that businesses have put flexibility before workers’ livelihoods. Sure, this may be ideal for some people but the precarious nature of zero-hour contracts and any low-hour contract alike means yesterday’s ideal may turn into tomorrow’s nightmare. This nightmare is the lived experience of many of Britain’s poor, painting a picture opposite to what some pundits and media outlets would suggest. Britain’s poor aren’t lazing around waiting for their next benefits payment. Instead, they are so desperate for work they settle for jobs with inadequate pay, inadequate hours and inadequate rights.

Economists clinging on to the mantra that poverty ends with work need to swallow their pride. It is all well in saying that employment can and still does bring people out of poverty but if, as increasingly is the case, that is not true for many individuals then decreases in unemployment cannot be looked at with unquestioning positivity. This isn’t to say unemployment is no longer important to reduce but that equal attention, if not more, should be paid towards the quality of life for those in work.

An economy that allows business to cut corners on workers’ wages and rights, where the government has to then subsidise these wages with benefits pay-outs and where, even then, these workers may still be in poverty and may still be homeless is absolutely unacceptable and absolutely unsustainable. Britain must realise we can no longer allow businesses to dictate their insidious labour-relations. We need an economy where work pays and employment is meaningful. Otherwise, we risk being trapped in a situation where unemployment continues to fall at the expense of workers’ living standards.

When the news says “unemployment is down” I urge people not to react with positivity or congratulations to the government but to wonder how and why this has come about. The answer is in front of us, employers have realised they can employ more workers at lower wages on flexible contracts that suit their business model. While this is the case “unemployment is down” shouldn’t be praised because more people are in work, rather, “unemployment is down” should tell you more people are being exploited.