Closing pubs, expanding unions, and the Wakefield renaissance

Afternoon all,

The ONS like to get us all up at 7am these days for new stats. Which is nice of them. Ironically for those of us forced to get up, this morning’s batch told us that January was a month for doing less. The economy shrank 2.9 per cent, which is grim but actually better than feared (we’ve got used to operating mid-lockdowns). Meanwhile goods exports to the EU fell by a staggering 40 per cent. There are data challenges, and a lot of the fall will be temporary (as stockpiling unwinds, and we learn how to fill in forms). But a huge shift is underway – the Institute for Directors had a survey out yesterday noting that 17 per cent of firms that used to trade with the EU stopped doing so in January. Half had stopped permanently. This is what big economic change looks like.

Before we get on to this week’s reads I also wanted to share that those wanting to make donations in memory of Professor John Hills, who we so sadly lost last year, are being directed to the National Communities Resource Centre at Trafford Hall. We all “stand on the shoulders of giants”, but for anyone working on UK social policy and inequality the truth is that those shoulders aren’t abstractions. They are John’s. Please give generously.

Have a good weekend,

Torsten
Chief Executive
Resolution Foundation

Segregation = inequality. Here comes the complicated bit – concentrate. Debates about the causes of higher inequality often seek to understand how much of the rise is due to growing pay gaps between different kinds of jobs (computer coders pulling away from retail workers) or between higher and lower paying firms (you earn more working at Google whatever job you do). But new US research argues this misses something big: greater alignment between these two kinds of inequality, as higher paying occupations are increasingly concentrated in higher paying firms. Outsourcing and fissured workplace arguments are consistent with this. But the biggest driver of this inequality, where higher/lower earning occupations are concentrated into higher/lower paying firms, is changes to the industrial mix within the service sector. In other words, we’ve got more restaurants AND more consulting firms. The paper argues this explains two-thirds of higher wage inequality in the US over the past two decades. Far from small beer.

Florence and the (Graph) Machine. Turns out Florence Nightingale wasn’t just a 19^th Century nursing pioneer – she was producing top charts long before TOTCs existed. Tim Harford’s latest podcast explains how she used statistics to convince people that sanitation was key to improving public health, thereby reducing the impact of cholera/dysentery. Harford focuses on her simplification of data into readable graphics that illustrated the impact of sanitation measures on army casualties due to infectious disease – shifting public opinion. Inevitably the dangers of data visualisation are also present – Nightingale’s most famous chart was influential… but statistically misleading. Bonus reason to tune in? In “Britain isn’t a social mobility nirvana” news, Nightingale’s distant relative, Helena Bonham-Carter, provides her voice throughout the podcast.

Gendered violence. It’s impossible to ignore the grim news dominating headlines in the week of International Women’s Day. The need for change is reinforced by a You Gov survey, showing that this isn’t about isolated incidents:  97 per cent of young women in the UK have experienced sexual harassment. Even more damningly, 45 per cent of women didn’t believe reporting harassment would change anything. The last year of lockdowns has rightly seen a focus on rising violence within the household. A recent paper from the US explains that it’s drinking, not just being, at home more that matters – with the relationship between alcohol consumption and emergency calls reporting domestic violence doubling.

Waking Wakefield. If you haven’t already, listen to Anand Menon’s new edition of Analysis, looking at the challenges facing his home town, Wakefield. It elegantly combines the lived experience of Wakefield today with discussion of what policy would make a difference – both against the background of a halving of manufacturing jobs and the loss of 18,000 roles in the coal industry since the 1980s. The conclusions? Public investment (what “levelling up” currently amounts to policy wise) is welcome, but how it is used in combination with educational improvements to create higher skill jobs is key. At some point attracting some private investment is key but, as the Governor of the Bank of England noted in a speech at Resolution this week, it’s been in very short supply in recent years. And also notes the blindingly obvious: local economies are complex, so in the end focusing on capital hand-outs driven as much by politics as economics is unlikely to be the real answer.

Chart of the Week

Earlier this week, FT columnist Sarah O’Connor posed a very unfashionable question “Are unions set for a revival?” In the UK they already are (at least membership wise) and, as this week’s Chart shows, it’s women leading this nascent increase. Unions have traditionally been thought of as a man’s game (partly because, until recently, men insisted on running our biggest unions). But the reality is that declines in male membership over recent decades meant that union density among women actually overtook men in the early 2000s. Female union density has now actually increased for three straight years – and membership is at its highest level since 1995. The 21^st Century labour movement is less about the stereotype of angry miners, and more female and public services focused. Its future will also need to be more digital. For some grounds for optimism look at the rapid rise of Organise or check out Breakroom – a ‘good jobs’ ratings site – both of whom we’ve backed via Resolution Ventures. It turns out innovation can work for workers, not just gig economy entrepreneurs…