Dead end jobs
There are now six million people working in low paid and often dead end jobs. Almost one in four people work in jobs that pay below £7.85 in London (the London Living Wage) and £7.60 across the rest of the UK (the Minimum Income Standard for the UK). Many of these people have few qualifications and work part time. They tend to be women, young people, or from ethnic minorities. And although they are in work at the moment, they move back and forth between low paid jobs and periods of unemployment.
To date, the various employment and skills programmes implemented by successive governments have had limited impact in helping these people at the bottom of the labour market. Instead they are processed through a no-pay-low-pay cycle. Now it seems the Coalition Government’s agenda looks like it may be repeating similar mistakes.
In his response to the unemployment figures, the Employment Minister Chris Grayling, emphasised his faith in the Government’s flagship Work Programme offering ‘personalised, tailored support to get people back into jobs’. As part of the new contracting arrangements, welfare-to-work providers will receive payments based on how long someone stays in work. This is a positive step forward, but on its own it is limited. Personalised and tailored support is required, but these reforms take no account of the quality of jobs people move into or whether they have any opportunity to progress from an entry-level job to a job with more pay, better working conditions and promotion prospects.
ippr’s latest report: More than a foot in the door argues that welfare-to-work providers should be paid not only to help people find jobs and stay in them, but also to advance in work. Success could be measured by a wage increase and/or a move from insecure to secure employment – for example, by moving from a temporary to a permanent job or from part time to full time employment. Put simply, companies running these schemes would have financial incentives to get their clients into decent jobs not just any old job.
Such a move would signal that quality as well as quantity matters in getting people into work. But it is important as well to recognise the limitations of welfare to work schemes, however well designed. Opportunities to find, hold and progress in work are largely dictated by the nature of the job market.
The financial crisis has exposed the need to strike a better balance in our economy between the need for flexible, part time and entry-level jobs, and the vulnerability of groups in low paid and temporary jobs who struggle to find and stay in work. Many organisations have introduced short term working as a way to protect employees from redundancy. In some cases this has been sensible and fair – allowing people to stay in jobs that would otherwise have been shed. But the increase in short-term working has also resulted in high ‘under-employment’, as a growing number of people are in part-time work because they cannot find a fulltime job, rather than out of choice.
Another key challenge is skills. Employers need to invest in and utilise the skills of the workforce – but people also need to know that if they gain increased skills or qualifications these will lead to better prospects for them. Sadly, the Coalition’s deficit reduction programme means that public investment in adult skills will be scaled back significantly, with no alternatives proposed.
Times are very difficult at the moment, but as our economy does recover it is vital that our flexible labour market can also provide sustainable jobs that provide people with a ladder for advancement. This, alongside the challenges of an ageing population and the needs of workers with caring responsibilities, mean that the quality of flexible and part time work is just as important as the headline unemployment stats.Tagged in: Chris Grayling, minimum wage, unemployment
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