Falling through the gaps: insecure work and the social safety net
Labour market support systems need to adapt to better support the growing number
of workers in vulnerable employment
In the UK, much concern about the changing labour market has been framed in terms of
the shift in risk that has occurred between employers and individuals. The gig economy
is often used to epitomize the imbalance in power between those controlling the
technology, and those carrying out the tasks. This risk shift reaches far beyond Uber
drivers and millennials on bicycles. It can be seen in the use of contracted, agency and
temporary staff and in the unpredictability of zero and minimum hours contracts of
those working for supermarkets, in warehouses, in social care and in universities.
The impact of this on people’s lives is exacerbated by a parallel transfer of risk in the
systems set up to support those who are unemployed or in low paid work. At the same
time as work has become less predictable, the safety net has become less springy and
with bigger holes.
This shift can be seen in cuts to social security, in the changes and increasing
conditionality that Universal Credit brings, in the way jobs are measured and impact on
poverty is not. It is seen in adult learning and the introduction of Adult Learner Loans. It
is seen in a childcare sector that does not have the capacity to offer care to those with
unpredictable or non-standard hours, even though those are the jobs increasingly likely
to be available for those on low pay.
The composition of those in poverty in the UK is changing, and increasingly people in
poverty are to be found in working households. Both real wages and living standards
are predicted to fall over the next few years in a way that is highly regressive, as prices
rise and employers are unable or unwilling to offer higher pay. Getting people into work
has been the biggest anti-poverty policy of recent decades, but this (movement out of
poverty) has not been the metric by which programmes and policies have been judged.
The UK’s new metro-mayors offer the opportunity for a redesign of interventions, but
will require bolder demands for control of funding, and measurement mechanisms from
the mayors themselves.
Lack of pay progression is a significant issue for adults in low-paid work. The evidence
shows the most effective way to increase earnings is to move jobs. However, this brings
risks for the individual and so requires them to have confidence in the social security
safety net. This confidence is eroded by increasing conditionality, logistical
administrative lags, asymmetric information and the lack of honest discussion about the
impact of low pay and insecurity at the bottom end of the labour market.
This is compounded by changes to access to training. Employers are most likely to invest
in training their higher paid, (and already high-qualified staff). People in low wage jobs,
wanting to improve their skills in order to support progression are now expected to take
out Advanced Learner Loans to fund their own training. This ‘risk swap’ combined with
significant cuts to the Further Education budget and poor information from learning
institutions on the financial and labour market returns to the courses they offer, has
seen a fall in the number of adults accessing training.
The Work and Pensions Committee have been examining self-employment and the gig
economy. They have noted the gap between Jobcentre Plus provision, Universal Credit
and self-employed claimants. Provision of support for all claimants (both in and out of
work) needs to be reviewed in the context of labour market changes. This needs to take
account of how jobs are measured, access and information about adult learning, as well
how technology enables support to be delivered differently. In France, Macron’s
employment programme addresses the social cost of precarious jobs by proposing
employers using casual workforces bear a financial cost. The incentives in the UK run in
the opposite direction.
There is scope, in better delivery of work support, to challenge the atomisation and
isolation of workers and the loss of social capital and networks of new working models.
The precarity of insecure work needs to be addressed, rather than exacerbated, by the
systems set up to support people through their working lives. In roles where working
hours are flexible or unpredictable, the division between private and public lives can be
complex. The interaction between the individual and the state needs to understand that
complexity and support people to navigate through their working lives rather than
leaving them without compass or adequate map.
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