Unions slam the Taylor Review

Matthew Taylor’s review of employment practices has been slammed by trade union leaders and the Labour front bench for not being bold enough over zero-hours contracts and in its response to the growth of imposed self-employment. The review doesn’t call for an end to zero-hours – only for a right for those on them to be given regular hours. Instead of demanding employee status, it recommends a new category of worker, a ‘dependent contractor’ who should be given greater protection by firms like Uber and Deliveroo and paid the National Minimum Wage, though only during times of normal or high demand (!)

 Beginning his report with the claim that the success of the UK  in creating a record number of jobs since the economic downturn, has been because it has one of the most ‘flexible’ labour markets, will not have endeared Taylor to trade union activists.  A similar argument used to be made by George Osborne; as real wages tumbled and the number of low paid unskilled jobs rocketed. While Taylor concedes that real wages may have fallen, he argues that if changes to tax rates and tax credits are introduced, then average take home pay is higher than the rest of the G7.

Taylor does call for equal pay for agency staff and better sick pay for low-paid workers and he does try to address some of the contradictions associated with work in the 21st century employment however. Discussion about growing ‘flexibility’ for example, is often considered taboo in labour movement circles – being the reason for growing work place ‘insecurity’ and invariably this is true.

But as Taylor recognises, evidence shows that not all of those (including a substantial number of Uber drivers) on zero hours want fixed conditions (McDonalds have claimed, only 20% of its zero hours staff want to change their status) while ONS data regularly shows that most- part time workers don’t want to, or can’t work full time and over the last three years there’s also been an increase in the number of temporary workers not wanting a permanent job.  But while 10% of workers report they’d like to work less hours another 10% would like to work more. 

As a result, Taylor calls for a two-sided flexibility that benefits the worker as much as the employer. This would enable individuals ‘to work in a range of different ways, on hours that fit around other responsibilities’. Yet he maintains, the best way to achieve this is through ‘responsible corporate governance and good management’ rather than new national regulations.

While a Tory government is unlikely to bring in any, it must also be said that a future Labour administration, wanting to use the law to prevent the super exploitation of the gig economy, would have its hands full. It’s true that the law has been used successfully against several big players like Sports Direct, Hermes, even Uber, but these set piece court cases have taken a huge amount of time and money. While the number of employers facing legal action for not paying the minimum wage, has increased, this is only the tip of a very large iceberg.

As the job market continues to fragment, Labour would have to not only rewrite employment laws, but also replace the current bureaucratic and extremely expensive tribunal system with an alternative approach (a new type of ‘labour state’) including a fully-fledged inspectorate able to dish out on the spot fines to employers who don’t toe the line, but also ‘name and shame’ those who continue to break the law.

But a major problem for trade unions, is that they have been slow to react to structural changes in the labour market and the workplace that have been developing for over two decades and which have been left to Taylor to resolve. With some important exceptions, unions have relied on organising established ‘core’ workers, protected by collective agreements if not national conditions, rather than trying to recruit a growing, but also an increasingly fragmented and youthful ‘precariat’.

As the core workforce declines and their own membership dwindles, unions face a huge task, having to learn new ways of organising and develop new relationships and communication channels with the self-employed. It’s by organising in the workplace, not relying on courts, tribunals and employment reviews, that pay and working conditions have been safeguarded, but  it remains to be seen whether unions can be more than relics of a previous age and face up to these new challenges.



As Matthew Taylor publishes his report, its automation that’s the elephant in the room

Election discussion about the economy, employment, and skills, largely avoided any reference to the9780861043644-us-300 (4) debate about automation and its consequences for work. Even if it’s accepted that technological progress will eliminate jobs (though there are major differences of opinion about how many) it’s also generally argued  that low-paid unskilled work will be replaced by new,  more rewarding types of employment and that people should continue to be up-skilled to take advantage of these.

It’s certainly the case that previous periods of technological upheaval have not resulted in prolonged periods of mass unemployment, yet there has been a stream of accounts – admittedly mostly from the more liberal fringes of Silicon Valley – about the future implications of robotics and artificial intelligence for social cohesion, rising social inequality and much higher levels of unemployment.

The Queen’s speech  reaffirmed  government priorities “My ministers will work to ensure people have the skills they need for the high-skilled, high-wage jobs of the future”  but Labour has also continued to have an equally optimistic view –albeit emphasising the importance of reviving investment levels and replacing free-market forces with much greater degrees of state planning, better infrastructure, improved technical education and free university attendance.

Thirty-five years since Andre Gorz’s essay on the potential benefits of automation in the creation of ‘post-industrial’ socialism, which prioritises self-autonomous leisure rather than imposed work, Labour’s policies (whatever their other merits) continue to be based around  the importance of full (time) employment, with the ‘bad’ jobs of the Tories being replaced by Labour’s better ones. In a week that  sees the publication of Matthew Taylor’s report on employment practices, Gorz, still vilified by most of the traditional left, is at least worth  revisiting.



The Gig is Up? TUC conference on insecure work

With growing concerns about the dramatic increase of insecure employment and the abuses of the ‘gig economy’, this week’s TUC conference was a welcome intervention.  According to the TUC, 1 in 10 workers are now affected by casualization and job insecurity, which invariably combine with low pay.   Increasing numbers are also ‘self-employed’ often against their wishes. The TUC  estimates that there are 1.7 million low paid self-employed.

Protecting this increasingly diverse and fragmented group of workers is a herculean task. The Tory government has commission the RSA’s Matthew Taylor to report on the current employment practices – this is expected very shortly, but as the conference understood, it’s only by electing a (more left wing) Labour government that employment laws could be changed and trade union rights restored. Labour’s plans for infrastructure spending and greater investment would, its argued,  lead to increased productivity through better jobs.  

Many of those attending the conference also had some excellent ideas about how new technology can be used to develop new ways for organising self-employed and agency workers, but short-term, front line, more immediate initiatives need to be combined with a greater awareness of the implications of major shifts in production and distribution. These developments, if more apparent in economies like the UK and the US are also universal developments, requiring new types of understanding and new strategies.

Mass trade unionism (UK membership reached its 13 million plus peak in the late 1970s) was associated with labour intensive/production line manufacturing, where it was often in the interests of employers to reach collective agreements and to standardise pay and working conditions. These types of arrangements – now referred to as ‘Fordism’, also predominated in other sectors of society. As a result, workers were provided with permanent and regular jobs, developing more collective occupational identities.  

As the twenty first century unfolds, developments in technology have resulted in the extensive automation of manufacturing and a much smaller ‘core’ workfare producing a greater output. Yet growing productivity and efficiency in manufacturing has not resulted in the expansion of highly skilled professional service sector employment, at least not to the extent that business theory had suggested –on the contrary, significant areas of this employment has been broken down into ‘para-professional’ work.

It’s no accident that as the size of the ‘core’ workforce has contracted, then so has the strength of the trade union movement – some estimate this will fall from the current 6 million to 3 million within a generation. Huge numbers of people who have become ‘surplus to production’ now depend on rather different types of work, providing ‘services’ for those more fully employed – like staffing bars, hotels, and restaurants, cleaning  houses, delivering  take away meals and dropping off on-line shopping products. Because of continued outsourcing and sub-contracting, many are no longer ‘employees’ in the traditional sense, sometimes not knowing who they are really working for, even who they are working with.

Yet, the TUC argues that ‘work is still the most important route out of poverty and to a better standard of living’ even though for many people, its own statistics show this is no longer the case. Now, rather than state benefits being associated with periods of unemployment, a new ‘working poor’ depends on state benefits to supplement full-time work. Despite the support for a universal basic, or ‘citizens’ income  increasing, this continues to by-pass the TUC (and the Labour Party).

Accepting the argument, that for many, work will no longer pay, will also enable a fuller discussion about the advantages of automating many jobs and reducing hours (as well as stress). It might be true that while some types of work can never be completely automated, as technology continues to race ahead, there are few jobs where automation cannot be extended. But while labour is so cheap and so plentiful however and paid work seen as the only route to salvation, this debate is less likely to happen.


Download the TUC’s  The gig is up

1 in 4 trade union members now work in education

thAlmost 1 in 4 of trade union members are employed in education. According to the ONS 1.47 million of a total union membership of 6.2 million are now drawn from this sector. With almost half (47.7%) of all employees belonging to a trade union, the education has probably become the most organised. (In manufacturing, union density is now below 1 in 5 and in construction, only 1 in 8)

The ONS provides interesting –but in many cases, slightly alarming data, about the current state of the UK trade union movement, which is now less than half the size of its 13 million 1979 peak. The level of membership  decreased by 275 000 between 2015/16 alone, the largest overall fall since records begun.

In addition:

  • Just 32.5% of workers are trade union members (13.4% in the private sector ,  52.7% of public)
  • 4 out of 10 trade union members are over 50, but only 1 in 20 are between 18-24
  • 4 out of 10 members can be classified as ‘professional’ workers. 43% have degrees
  • Trade union density amongst female employees is now greater than it is for males
  • Over a third of ‘middle earners’ (£500 – £999 a week) and 1 in 6 of employees earning over £1000 a week are in unions. Only I in 8 of those earning less than £250 a week are TU members

Trade union can’t and won’t ignore these changes, but at the same time they will recognise these are as much the result of longer-term structural trends across labour markets as they are the consequences of draconian anti- trade union legislation or government policies and develop new strategies accordingly.

school-office-staff1That education workers now play a key role in the labour movement, provides both further impetus for greater organisational unity  (despite the NUT/ATL merger at least 10 different unions operate in the sector, often in competition with each other),   but also for creating more effective ways of working with student and parental bodies.






Young voters flock to Labour

Recently released data from the polling organisation YouGov shows the800_cp_montreal_student_protest_120223  extent of young people’s willingness to back Labour in the recent General Election, with the party enjoying over three times as much support from 18-24-year-old voters as the Conservatives – amongst 18 and 19 year olds, support was even stronger with 66% opting for Labour compared with just 19% for the Tories.

According to YouGov, 64% of students voted for Labour compared to just 19% for the Conservatives. This was a clear reflection of Labour’s manifesto commitment to end university tuition  fees  – the average amount of debt acquired per student has now reached more than £32,000 with a third of students  considering their courses did not provide value for money (Guardian 08/06/17)  Labour also pledged to restore Education Maintenance Allowances (EMAs) for post-16 students, to make Further Education courses free and to upgrade the quality of vocational education and apprenticeships.

At the other end of the age group, things could not have been more different, as almost 70% of 70 year olds voted Conservative and 58% of those between 60-69.  Participation levels were also much higher amongst older age groups, with 57% of 18-19 year olds turning out, compared to 84% of those 70 plus. YouGov also found that differences in the way various occupational classes voted were becoming much less significant and the tendency to vote Conservative declined as educational levels increased –with Labour enjoying a 15 % lead amongst graduates.

Young people’s support for Labour was not just the result of its policies or the popularity of Jeremy Corbyn – the party was far ahead of the Tories in its ability to use social media, so as to help neutralise the attacks on Corbyn by the official media. It was also the result of major efforts by student unions to increase registration, handing in hundreds of registration forms from their members just hours before the deadline.

With a highly volatile electorate, Labour will not take this support for granted and with dreadful employment prospects for young people  –even for those with degrees – it will need to develop clear policies that address job market insecurities, as well as continuing to improve educational opportunity. Nevertheless, the YouGov data provides many positives. 



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.  


From a profits squeeze to a wages grab


Latest figures from the ONS, show the employment rate (the proportion of people aged from 16 to 64 who were in work) at 74.6%, the joint highest since records began in 1971. The unemployment rate has also fallen to 4.7%, down from 5.1% for a year earlier. It has not been lower since June to August 1975. Yet in 1975, it was a very different economy with a very different labour market. The UK was the 5th or 6th biggest manufacturer in terms of total output (it’s now 9th) with 1 in 5 still working in the sector (it’s now less than 10%). Harold Wilson was prime minister and a referendum on EU membership recorded two-thirds support.

Then, some 17 million people (approaching  40% of the workforce) belonged to trade unions compared to around 6 million today. As Andrew Glynn and Bob Sutcliffe described in their influential Workers, Capitalism and the Profits Squeeze – organised labour had been able to use its power to steadily increase its returns at the expense of profits. Capital could only resolve this by attempting to increase prices but could not fully win back what it had lost in wage negotiations because of increased international competition. Nevertheless in 1975, inflation reached a post-war peak of more than 25%

Today the situation could not be more different.  After approaching 65% of national income in the mid-1970s, the proportion of national income returns to labour is down to 55%. Alongside the fall in the wage share, there has been a general rise in the inequality of earnings. The most highly paid have taken an ever larger share.  The average full time person in work would be paid more than £7,000 more than they actually are if wages had kept up with economic growth and if the best paid had not increased their wages at the expense of everyone else.

Even if economic growth may have climbed to 2% per annum, this has been the result of an increase in size of the labour force not increases in productivity, with firms increasingly dependent on constant supplies of foreign labour. As a result per capita (per worker) income has barely increased at all. Meanwhile, the profit share (operating surpluses as a percentage of national income) rose from 24 % in 1980 to 28% in 2011.

The declining fortunes for workers is not simply a reflection of repressive trade union legislation. It’s also the result of significant structural changes within the labour market -the continued decline of traditional manual employment, where trade unions were always strongest, but also the ‘hollowing out’ of many ‘middle’ occupations. These have been replaced by huge increases in low-paid work at the bottom end of the service sector, the growth of casualised labour (‘zero-hours’ employment is approaching 1 million) and of bogus ‘self-employment’ –all areas where it is extremely difficult, though not impossible,  for trade unions to organise.

Whereas in the 1970s Labour politicians and many trade union bosses tried to sell ‘incomes policies’ as a way of controlling wage increases/inflation, today’s ‘precarious’ the labour market imposes its own discipline and as a result, as well calling for the repeal of anti-trade union laws, campaigners have demanded new types of state policies, for example, an increased minimum or ‘living’ wage and an end to ‘zero hours’. Demands for a Universal Basic or a ‘Citizens’ income to gain ground, which though accepted by Greens, continues to be largely ignored by Labour and union  leaders.