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Feedback on the Future of Work

11mar98:Church Action on Poverty: Unemployment and the Future of Work (posted with permission).

Church Action On Poverty Summary April 1997

The Churches Enquiry into
Unemployment and the Future of Work

Is it still true that everyone has the right and duty to work? Should we tolerate low pay and poor conditions if that enables more people to work? Is full employment still a realistic and appropriate objective today?

These are some of the most important questions which face our society. Meanwhile the divisions in that society become wider and wider between rich and poor, between those with good jobs and those with bad jobs, or no jobs at all. The Council of Churches for Britain and Ireland set up a working party 18 months ago to undertake an Enquiry into Unemployment and the Future of Work. It consulted widely and visited many different regions to find out how the profound changes taking place in the labour market are affecting people in all kinds of situations, but especially those who are disadvantaged or poor. Its report published on 8 April, challenges the defeatism of those who say that good work for everyone is a thing of the past and the complacency of those who seem not to care.

Key Findings
  • Work is central to the human condition, not an optional extra. The goal of full employment - or Enough Good Work for Everyone - must be a policy priority. This means reversing the institutionalisation of unemployment.

  • Technological change and globalisation presents opportunities for increased human creativity and well-being, but also presents challenges, especially the growth of unemployment and poverty. Re-evaluation of employment is needed, recognising its social role, not just economic function. Overwork and distribution of work need tackling, along with distribution of other responsibilities - paid and unpaid.

  • There is a need to revise current criteria for economic success and to analyse unemployment figures more critically.

  • There is a need for Equal Opportunities Policies to counter discrimination on grounds of gender, race, disability and age, in the workplace and in terms of barriers to geffing work.

Policy Conclusions
  • Redistributing of resources through the taxation system: to encourage the creation of more private sector jobs; to increase employment in the public sector; to fund voluntary and community sector work; and to make specific help available to the long-term unemployed.
  • Reforming of the Benefit System, reducing reliance on means-testing.

    A national minimum wage but without restoration of differentials higher up the pay scale; self regulating restraint at the top end of the pay scale is also recommended.

  • 'Good Work' which requires that there are better conditions of work, adequate enforcement of such rights and fairer (collective) pay bargaining.

  • In training basic skills for all should be given priority.

  • The creation of a National Employment Forum, which includes consultation with unemployed people as well as other sectors of society.

  • The churches review resources given to tackling unemployment, at practical and policy level and more priority to tackling unemployment in Christian practice and worship.

A Theology of Work

The aim of the Enquiry is to 'analyse the various emerging trends (in employment) and evaluate the policy options from a Christian standpoint'. The theological content of the report is therefore the framework for its findings. The principles outlined provide the following vision of work:

  • Work is an offering of life, service and creativity to God and the community.

  • All work is to be valued not just the economically productive.

  • Everyone has a vocation, a role to play; there is a duty, and a right, to work and earn in a way most appropriate to the gifts given by God.

  • An employment contract is more than an economic tool, work has a wider social context.

  • Work needs to be part of the rhythm of a full life with time for rest, reflection and relationships.

Part I Context: Labour Market Trends and Policy.

In order to build an inclusive society, in which all are valued, unemployment must be seen in the wider context of poverty, exclusion and labour market changes.

Three main changes are identified as underlying labour market changes:

  • The technological revolution.
  • The growing role of women in the labour force - from 1985 to 1996 overall economic activity was 62.8%; male rates fell from 76.4% to 72.3%, whilst female employment rates rose from 50.3% to 53.8%.
  • Deregulated capital and work.

The effects have been that those at the bottom end of the economy, even if they are working, live in poverty. At the same time there has been a polarisation of income and opportunity.

This has caused polarisation of both individual pay rates and of household income, through the growing divide between work rich and work poor.

Earnings

Earnings: lowest 10%top 10%
1985 63% 184%
1995 57%205%
As a percentage of average earnings

Household Incomes
Changes 1979-1992

Lowest 10%averagetop 10%
-13% +40% +62%


Attitudes to the Changes

  • Globalisation and new technology mean changes in work; full employment cannot be achieved by turning the clock back.

  • Positive opportunities could be created by increased flexibility and global markets, but:

  • Governmental control, and regulation of the market, are both possible and necessary so that the risks and benefits of the new industrial revolution are shared.

  • Choices can be made; providing 'Good Employment for Everyone' must be a policy priority, not just an economic by-product.

  • Unemployment is not a 'price worth paying' for economic 'success'.

  • Geo-graphical variations need consideration in policy making; the positive role of community in some areas is noted and may hold some lessons for tackling regeneration.

Part II Choices and Options.

The fundamental finding is that job creation is necessary and that given sufficient priority, political will and public consensus, good work can be created for everyone. Economists do not believe this is an impossible goal, they differ only about how and whether it is politically achievable.

Government can act through changes in tax structure and regulation of working conditions. The Report emphasises that jobs should not be created at any price - 'service should not be servitude'. The American approach (which creates low paid jobs on the back of limited Social Security) is rejected.

Where Should New Work Come From?

A mixture of job creation, in the private, public and voluntary or community sectors, is recommended.

Private Sector work should be created by reducing taxation on jobs, especially at the lower end of the wage range. It is recognised that these are likely to be in the service sector. The value of some of this work will lie in human factors, not just productivity.

Public Sector work can be created in a variety of areas, including health care, education and community care. Government borrowing is not recommended so this will have to be funded by higher taxation. The Enquiry specifically disagrees with the OECD assertion that public sector job creation is not possible.

Voluntary and Community Sector work can also be created. The 1980s' Community Programme is considered as a possibility, provided that such work is rewarded at the rate for the job and is not marginalised. It might include advice work and regeneration. Public funding, again through taxation, would be required. However, this sector should not simply take over services which should be provided by the statutory sector.

Together these should create significant labour market expansion, not just schemes.

Good Employment

This requires decent and dignified employment conditions and pay. A number of recommendations are made:

Pay can be regulated to some extent by collective bargaining. However, high unemployment and changing workplaces, particularly the growth of service industries and homeworking, has reduced the effectiveness of Trade Unions and the bargaining process. A statutory Minimum Wage is needed, and is best set by a Low Pay Commission.

Inequality also creates social exclusion. A minimum wage should not be followed by restoration of differentials and those at the top of the pay scale should limit their pay rises. This area is, however, more appropriately dealt with by voluntary pay restraint.

Working conditions should be regulated through a statutory framework. Penalty clauses and unilateral changes in contracts should be outlawed. Trade Unions have an important consultative role in setting and enforcing conditions. A Labour Inspectorate might also be established to monitor and enforce employment legislation.

Equal Opportunities Monitoring to tackle discrimination both in accessing work and in the workplace, must have legislative backing and management support. The model of the Fair Employment Commission in Northern Ireland is recommended.

Work for the Unemployed

The main priority must be to tackle underlying labour market problems, but specific measures to reverse long-term and youth unemployment are needed. This may require the state to step in as employer of last resort. A number of schemes are reviewed including:

  • a Right-to-Work benefit plus 60, with a penal rate of benefit 30 for those who do not participate

  • public sector or community work, at the going rate, limited to 25 hours/week, with time for jobsearch for a longer term, full-time job

Principles are recommended, not a specific scheme; these are:

  • pay must be at the going rate

  • compulsion is out, most unemployed people are not 'workshy'

  • incentives for Employment Service staff to disqualify from benefit are 'morally indefensible'.

The Benefits System

Unemployment is largely a labour market problem but consideration is given to the interaction of employment and the benefits system. Policy recommendations include:

  • A return to the principle of collective not private insurance; the latter cannot share risks adequately.

  • Cuts to contribution-based unemployment benefit, in the Jobseeker's Act should be reversed.

  • The upper earnings limit on NI Contributions should be abolished.

  • Benefits could be simplified by eg. integrating in-work and out-of-work benefits and assessment of individuals not households.

  • Flexible work must be matched by flexible benefits eg. allowing claims by part-time workers (as in Eire) and increasing disregards for casual earnings; though means-tests will always create a form of poverty trap.

  • All fraud, not just benefit fraud, needs to be combatted.

A Citizens Income?

Arguments in favour are that this could free people to do work they want to do, regardless of pay, by divorcing work from earning a living but it is rejected as too costly. Taxation is better used to create work and get people off benefits, rather than increasing benefits on which most do not want to depend.

Education and Training

Provision for low achievers in the UK is below that of other European countries. This affects employment later in life. Job creation in education and training is recommended. Resources should go to those who most need training. Output- related funding will not meet this objective.

Vocational Training is recommended on a day release basis for all 16-19 year olds aiming at 100% achievement of NVQ2. Adult Vocational Training should be funded in the same way as university studies, with loans to cover maintenance costs. It should be easier to study whilst unemployed.

Overwork and the Family

If work is not divorced from income through a Citizens Income, then redistribution of work, as well as money, is needed. Overwork is recognised as a problem and research is needed on how to restructure hours worked whilst ensuring sufficient income for all.

Shared family responsibility should be encouraged eg. by limiting parents' working hours. Flexitime, at the employers discretion, should be more available. Childcare should be for all, not a luxury for the well-paid.

A National Employment Forum should be established to consult all sectors of the community on a range of employment issues. Further related areas needing examination include pensions, local employment initiatives, family, housing and work and disability in the workplace.

Further Information

The full Report (8.50, ISBN 0 85169 238 9) and a 20 page summary (1.95, ISBN: 0851692397) are obtainable from good books hops or from CCBI Publications, 35-41 Lower Marsh, London SEl 7RL. Tel: 0171 620 4444,

Further copies of this summary along with copies of CAP's submission to the Enquiry are available from Church Action on Poverty, Central Buildings, Oldham Street, Manchester Ml 1JT Tel: 0161 236 9321

Church Action on Poverty
Central Buildings
Oldham Street
Manchester
MllJT
Church Action on Poverty was formed in 1982 as a Christian-based, ecumenical response to increasing levels of poverty in the UK. We are committed to a programme of theological reflection linked to educational and campaigning work.
CAP Educational Trust Charity No.328614.

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