Now even Pricewaterhouse considers a Universal Basic Income

robot-waving-13220988Pricewaterhouse Cooper (PwC) the global professional  services firm has entered the debate about the effects of artificial intelligence and robotics on employment. Calculating that 30% of jobs (some 10 million)  are at high risk, its predictions are about midway between those of Oxford academics Frey & Osborne’s  2013 prediction of 47% and OECD’s 2016 10%.

Integral to PwC’s predictions are a loss of 2.3 million jobs in the retailing and wholesale sector and a further  1.2 million in manufacturing, in other words, about half of the jobs in both of these sectors. It relates specific job losses to the nature of particular work roles, whether they are routine or non routine, but also to levels of education – the less an individuals qualifications, the more likely the chance of losing their job.

It’s long been argued that routine work is much easier to automate. But in an era when most young people who enter the labour market are overqualified for the work they do, it’s unhelpful to argue to suggest that job security can be protected and ‘the race against the machine’ prolonged by everybody being better educated. 

PwC is more accurate in its arguments about the potential cost of labour replacement and in its observations that the propensity for job substitution in the UK is lower than elsewhere, because this country is a classic example of a low wage economy and a result an economy with low rates of capital investment.

PwC is also right to be concerned about how automation will widen income inequalities – though it’s folly to suggest that workers with not enough qualifications can ‘race against the machine’ by getting more. Like others, PwC attribute too great expectations to education.  However although its not completely convinced about the case for a Universal Basic Income, PwC is joining a long list of organisations that are beginning to explore this issue.  



Restating the case for a basic minimum income

The surrender of Sports Direct is a significant victory, but it should notth thundermine the case for a basic minimum income for everybody, in addition to anything earned as a ‘wage’.   I’ve updated a previous contribution on this.  It examines the difficulties with securing the National Living Wage for all workers, but also in eliminating ‘zero hours’ contracts.




A living wage or a citizens income (full version)

May 23rd 2016

Presentation to Lambeth Momentum and Common Knowledge

The introduction of a statutory Living Wage – at £7.20 an hour a 50p increase on the old minimum wage – should be a cause for celebration, particularly if it is due to be increased to £9 an hour by 2020. Instead it’s received a cautious welcome because of the huge degree of uncertainty about who it will really benefit. Though some estimates show that over 6 million workers are currently paid less it’s possible that only about 1 in 5 of these will probably gain directly.

Many of those who won’t, belong to the ‘cash in hand’ informal economy, some will become converted to ‘self-employed’ status though continuing to be dependent on their previous ‘employer’ for an income. Others will suffer a cut in hours, even lose their jobs completely, while workers under 25 will not benefit at all. It’s also been calculated that 2 million families could lose up to £1,600 anyway as a result of cuts to tax credits.

Some of the most ferocious opposition to the new requirement has come from employers organisations. Though it’s certainly  true that many large firms continue to make ‘super profits’ at the expense of their employees,  to pay big  bonuses to managers and shareholders large dividends, it is also the case that, particularly  in the more labour intensive parts of the service sector, there are layers of small scale operators who are dependent on low pay and an endless supply of overseas labour, to run what are basically hand to mouth businesses with low profit margins, with no desire to invest in workforce training;  but at the time reminding us they are crucial in ‘providing jobs’….

Download   full text                                                                                                        A Living Wage or a Citizens Income