Top Employment figures released but its ‘quality not quantity’ for a bright economy

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Professionals at UK design business exhibition
Professionals at UK design business exhibition

During the previous quarter of 2018 the employment rate was 75.5% which shows impressively high employment figures for the UK this Autumn. (1) The government say this “is the highest since comparable records began in 1971.” The Conservative Manifesto also declares that “Since 2010, 2.9 million jobs have been created. We see employment at record levels. Employment [is] higher now than since records began. And unemployment lower than it’s been since the mid 1970s.” (2)

Ideally this demonstrates a strong economy where many people have great jobs and pay substantial taxes on their wages and this in turn encourages good economic growth and a well functioning society. This picture of nearly full employment should give back all the funding needed for ensuring social benefits, healthcare, primary and secondary education and so on is provided financially for everyone who needs it. This is because the money generated from the taxes that employed people pay contributes directly to the economy via the Treasury, the government’s financial ministry.

However critics might consider that this headline statistic is misleading. This is because many jobs especially in the service economy are low paid and do not offer full time hours. Coupled with a relatively high personal tax allowance compared to other countries like Denmark, a 75.5% employment rate is very positive news but doesn’t necessarily translate into the amount of taxes needed to cover all the welfare needs and requirements of a modern society with an increasingly ageing population.

Many people in the UK are working and are still eligible to receive additional benefits such as universal credit and housing benefit. Often people are encouraged to be self-employed as the work offered can be temporary, with little training and investment by the employer. These companies that hire self employed people to do relatively low skilled work can sometimes even require the worker who may be part time or on a zero hours contract to invest in a special vehicle or other equipment before the work can be commenced.

Career options in some ‘Mc.Jobs’ can be few or non-existent, in the case of fruit picking for example. Unsocial and inflexible hours may be offered with no opportunity for the employee to choose hours to suit them, that enable them to conveniently care for their families, especially in seasonal retail positions and areas such as such as barwork and tourism.

Universities sell degree courses to prospective students on the glamorous salaries that will be available to graduates upon completing their courses. The reality is often very different and it is a common sight to have a pile of CV’s from post-graduate educated people seeking temporary dead end office jobs or retail adviser roles that are nothing to do with their studies. These are jobs just to keep some money coming in to live on for the graduates, while they look around for a real permanent job with career prospects.

Self employment and company ownership is on the rise so PAYE income and the usual national insurance contributions that accompany it may continue to decline. “Creating a nation of slaves to poverty-waged, piecemeal jobs doesn’t solve anything; in fact, it’s bad for the economy” wrote Hannah Fearn in the Independant last year. (3)

There are serious threats to the governments economic coffers as valuable business rates from traditional retail shops may yet become a thing from the past. Automation negates the need for some businesses to require a large full time workforce. Online retailers offering attractive prices to consumers are often based offshore for tax purposes with warehouses in cheaper rural areas.

Whatever the outcome of Brexit, maintaining the aeronautical and car manufacturing industries, continuing to be a hub for financial services investment and keeping our professional and scientific companies thriving, will be key parts of the challenges that a future government will face to ensure employment rates are maintained or continue to rise.

Many statistical analysts agree that in 2018 the UK is the worlds 5th largest economy. (4) In order to maintain and develop this famous island’s GDP and to create a wealthy, healthy and truly progressive country, we need to ensure that everyone from Great Britain and Northern Ireland all have a decent place to call home. We also need to make sure everybody of working age can make a ‘good living’. Families using food banks because of poverty should only be something from Victorian history books and the writings of Dickens.

Providing adults, children and elderly people living in the United Kingdom (or whatever is left of it geographically, after the full effect of Brexit becomes clear) with the standard of living they will expect and need in an online 21st century environment will be an exercise in change management.

Leading a government that will continue to successfully obtain the billions of tax revenues needed to balance the economy, will involve some major strategic rethinking and also some serious innovation. The UK will also depend on the experienced and robust civil service, to administer what will no doubt continue to be, a period of unprecedented transformation.

 

(1) ‘Regional labour market statistics in the UK: September 2018’ Office for National Statistics website 17 Oct 2018 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/regionallabourmarket/september2018

(2) ‘Conservative party manifesto launch, factchecked’ The UK’s independent factchecking charity website 18 May 2018 https://fullfact.org/event/2017/May/18

(3) ‘The Tories will tell you they’re the party that gives the nation proper employment – but even their advisers don’t agree’ The Independant, Hannah Fearn, 9 May 2017 https://www.independent.co.uk/voices/tories-employment-statistics-unemployment-general-election-jobs-reality-different-a7726666.html

(4) ‘Projected GDP Ranking (2018-2023)’ from IMF world economic outlook Statistics Times 9 Jun 2018 http://statisticstimes.com/economy/projected-world-gdp-ranking.php