Blog

Category: Living Standards

Low Pay Is Fast Becoming a Defining Challenge of Our Age

James Plunkett

This post originally appeared on the Huffington Post

You can tell a lot about a downturn by the image that comes to define it. From queues outside job centres in the 1970s and early 1980s to the poll tax riots that preceded the early 1990s recession, the pictures that stick in the mind have a habit of reflecting the key economic and political challenge of the time. So what will be the iconic image this time around? Images of last summers' riots will undoubtedly endure. But the more representative picture of the squeeze so far would be much less dramatic: a low paid, part-time worker, struggling in to work each day, bringing home a wage that barely pays the bills.

Today's new figures from the ONS confirm what's been suspected for some time: low pay is fast becoming one of the defining economic challenges of our age.

Gavin Kelly

This post originally appeared on Gavin's New Statesman blog

The next election will see a battered electorate in need of economic and social respite confronted by a political elite woefully lacking in resources and public trust. Never in recent times will so much be asked from leaders who have so little to respond with.

The result is starting to pose interesting questions about some of the familiar features of electoral politics – one of these is the entrenched cult of pledge-card politics and the type of statecraft that underpins it.

The art of boiling down an entire election pitch to easily marketed bite-size promises – "short and catchy" as Peter Mandelson used to put it - reached its zenith in the UK in 1997 and has dominated subsequent campaigns even if the pledges have paled over time. Looking back there was an inverse rule between the size of the pledges and what they succeeded in communicating. In 1997, some of the commitments were certainly modest yet still managed to say something significant about the character of the future Blair government (not least by specifying where resources would be found to pay for new spending).

Matthew Whittaker

This post orginally appeared on Public Finance

Even in the boom years, a large proportion of the population never shared the proceeds of growth. That’s even less likely today as austerity really hits home

Mired as we are in a fifth year of economic crisis and austerity, it’s easy to forget that not long ago we’d enjoyed fifteen sustained years of economic growth.
But it may not be just the severity of the downturn that explains why the good times feel so distant: for many of us, the growth years were not quite as rewarding as we once thought. Prior to the big squeeze, Britain was increasingly divided, and most of us were on the wrong side of the chasm.

Matthew Pennycook

This post originally appeared on the New Statesman blog

Tomorrow marks the start of the first Living Wage week. It is tangible proof that, 11 years after a small broad-based East London community alliance revived an idea first forged in the industrial heartlands of 1870s Britain, momentum for increased living wage coverage continues to gather pace.

James Plunkett

This post orginally appeared on Coffeehouse

David Cameron was right; the good news has kept on coming. This morning’s first estimate from the ONS puts GDP growth in the third quarter at 1.0 percent. Cue much justified squabbling over what the 'real' number is. A significant portion of this growth will be a one-off, post-Jubilympics bounce-back, suggesting slower underlying growth. As Jonathan pointed out yesterday, ONS first estimates have a margin of error of 0.7 percentage points, meaning that even with these factors...

Changing the conversation in 2012

Gavin Kelly

The post first appeared on Gavin Kelly's New Statesman blog.

Low growth, high unemployment, deeper cuts, falling wages, and a further reduction in the living standards of working families. Just in case you were under any doubt, 2012 is going to feel like one long Groundhog Day, a darker version of its grim predecessor.

There will, of course, be many new twists and turns. But the raw material of the economy-driven news cycle is likely to have a certain haunting familiarity, even if it is far harder to predict the political ramifications and Westminster winners and losers.

So who pays?

Gavin Kelly

This post first appeared on Gavin's New Statesman blog.

Just in case you were under any doubt about where the burden of today's widely expected cuts to tax credits will fall, the chart below should make it clear. Over 75 per cent of the pain of today's changes to tax credits is felt by the bottom half of the income distribution. The vast majority of these from families with children.

The decision to scrap the planned increases in Child Tax Credit (hitherto the coalition's one emblem of its commitment to tackle child poverty), together with other cuts to Working Tax Credit, will mean more than £1.2bn of cuts in 2012.

The onslaught against working families continues

Gavin Kelly

This post first appeared on Gavin's New Statesman blog.

If today’s report proves correct then tomorrow Nick Clegg will announce a further blow for low-to-middle income families in order to pay for a new programme for the young unemployed.

Let’s start with the better, latter, half of that sentence. The new programme will, according to insiders, walk and talk like Labour's 'Future Jobs Fund' which offered incentives to employers to take on 18-24 year olds who had been out of work for more than 6 months.

Learning the right lessons from Labour's economic record

Gavin Kelly

This blog originally appeared on Gavin's New Statesman blog.

You might think the one thing the world doesn't need right now is yet another instant history about the Labour years. But here one comes -- this time, though, with a difference. The authors certainly won't be dining out on the royalties and there's no insider gossip or "he said, she said" revelations about rows in Downing St. Which is perhaps one reason why it's worth reading; it says something serious about what did and didn't happen to economic performance during the Labour years.