Recond low unemployment figures mask less optimistic trends for many poorly-paid workers

Personal debt is driving the economy while wages stagnate, says Dave Watson

Why is this not the golden age of work? The Scottish jobs market is proving to be resilient, even with the Brexit backdrop. Unemployment is at a historic low with Scottish and UK ministers are celebrating the 3.8 per cent record low unemployment. And the fact we have more people in work than ever before.

The problem is that these top line figures mask less optimistic trends.

Those high in-work figures include large numbers of part-time workers, those with non-permanent jobs, record numbers of people on zero hours contracts or in agency work, and the, often bogus, self-employed. Throughout most of the last decade, almost half of the men, and a third of the women, making a new claim for Jobseeker’s Allowance were last claiming this benefit less than six months previously (another measure of an insecure workforce).

The New Economics Foundation say two in five of the UK workforce are in ‘bad jobs’. Job quality is worse for the self-employed, where low income is rife. More than half of all selfemployed people are failing to earn a decent living. The Joseph Rowntree Foundation say that millions of workers want better and more work.

Of course, one person’s idea of a good job is another’s bad day at the office. Some people value security, others flexibility, and most want a degree of both. And how secure people feel will depend on their relationship with their employer, and whether their voice is heard at work (another reason why we should all be in a trade union).

This is a defining issue of our age: a large cohort who face uncertain working hours, have few rights and protections – like being able to return to work after maternity leave, or the right to sick pay. These are people stuck in the low pay, no pay cycle.

There is more than a moral point here. Try getting a mortgage if you are on a low paid zero-hours contract. It is simply not possible, you have no evidence you can make regular repayments. And unless you have got a successful business off the ground, which most haven’t, the same is true for the self-employed.

Because of the lack of social housing most people are then pushed into the high cost private rented sector which provides little security of tenure. These tenants live at the whim of a landlord who can evict you with few legal barriers. The private rented sector has more than doubled since 2007.

So, people use personal debt to fund their insecure lives. And it is personal debt which is driving the economy, against a backdrop of stagnating wages and rising costs. Incomes adjusted for inflation are falling. It’s a recipe for serious problems ahead.

There are already signs that the consumer-driven momentum which is keeping the British economy afloat is declining. Household income is falling and few of us, due to low interest rates, have savings that will last long.

It means employers tend to employ low paid flexible labour rather than invest in training, technology or infrastructure. It’s cheaper and easier. It’s surely, in part, why we have low productivity in the UK economy.

It also increases poverty. Six in ten children living in poverty have at least one parent in work. The rest of us pick up the bill for the extra costs to public services and social security.

One striking trend is the growing insecurity in the public sector, driven by cuts to public spending and the changes to commissioning systems. Supply teachers, outsourcing to consultants, temporary lecturers, fixed term contracts, agency nurses, social care, agency administrators – all play an increased role in the delivery of education, care and public services.

This cannot be good for public servicedelivery. and with more of us in the insecure society – the more there is a call on these services to step in when families hit trouble like being made homeless or they can’t pay the bills or meet the credit card payments.

So, when we are told about the ‘resilience of the British economy’, the historic employment and unemployment levels, and that Scotland has the strongest jobs market in the UK, we need to look at the reality of what kind capitalism we are creating. There is a large underpaid, under-employed, insecure workforce stretched to limits. It might help to explain the political instability we are living through.

It is good for all of us to ensure we build a strong sustainable economy. With stable and productive work. In which we all have a stake. Voices at the lower end of the workforce should be at the forefront of the debate about the future of work and society. it might help build a world in which we all have rights and a stake – and help us build a stable future together. Dave Watson is the head of policy and public affairs at UNISON Scotland