Thursday, 29 January 2015

Back to the 30s?

In recent months, the government has constantly proclaimed the good news about increasing employment and falling unemployment. If those figures tell the whole story, it would undoubtedly be good news.

However, as I am out and about in my constituency, people keep telling me that it isn’t really like that. They tell me that their experience is of a labour market increasingly characterised by low-pay, insecure work, zero-hours contracts and stagnating wages.

If they are correct, that has massive long-term consequences for the economy, for communities and for families. For instance, even if you are regularly working 40 hours a week, who is going to offer you a mortgage if you have a zero-hours contract? Or, if your work is made up of lots of small contracts, which exclude your employer from national insurance payments, what does that mean for any pension entitlement?

Other statistics suggest that my constituents are right and we need to be worried:

·         Many people can’t get the working hours they want or need. More than 1.3 million people work part-time because they can’t get a full-time job – up 200,000 since 2010.

·         There are now 1.4 million zero-hours contracts in operation, despite the fact that in practice most of these people work regular and predictable hours.

·         In total, there are 3.5 million people in work who say they want extra hours – with an average 12 extra hours wanted a week.

·         There are now 4.9 million workers earning less than the living wage – up 1.5 million since 2009. This is about 1 in 5 people in work.

·         1 in 4 workers on the National Minimum Wage has been in a minimum wage job for five years or more.

·         Real wages for all employees have fallen by more than £1,600 a year since 2010.

·         Because of the increase in low-paid work and stagnating wages, the tax credits budget has increased by £900 million more than planned in the last year alone.

After a decade when we had seen poverty falling, it is now clearly on the increase, with the working poor being particularly hard hit. Is this government intent on taking us back to the 1930s?