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Coffee House

Labour market flexibility and dignity

6 May 2014

9:00 AM

6 May 2014

9:00 AM

Two front pages today report what they see as bad news, and both stories are certainly ones politicians need to worry about. The Guardian reveals a leaked letter showing jobseekers will face sanctions if they do not apply for or accept ‘certain zero hours jobs under the new universal credit system’, while the Indy splashes on research by the Resolution Foundation which found that self-employed workers are earning 40 per cent less than a typical employee. The paper says these workers are the ‘hidden victims of the recession struggling by on low pay’.

Saying that either of these stories represent ‘good news’ sounds far too flippant – but they do reflect the flexibility of Britain’s labour market which has enabled many people to remain in employment and off the dole during the downturn. The former, even though the conditions of work concerned are far from what most workers would aspire to, is far better than the latter: leaving the labour market entirely damages a worker’s confidence, their soft skills, and naturally prevents them from progressing to better hours and pay, as those on zero hours contracts or low-paid self-employment have a prospect of doing so.

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But behind that academic argument are voters who feel as though their lives are not improving. Labour is much better at expressing concern about the indignity that these workers feel – partly because the party places less emphasis on the importance of labour market flexibility in keeping people in work, although notably Ed Miliband’s big crackdown on zero hours contracts ended up being rather more timid when he actually announced it. Alison McGovern, a thoughtful Labour MP in a marginal seat wrote a pamphlet for the Fabian Society last year in which she examined the importance of dignity. She wrote:

‘We should change our world not just because we see an imbalance in power and resources which restricts global economic growth, but because we value human dignity. We are moral creatures who react emotionally and subjectively to the world, as well as being able to understand it scientifically.

‘Zero hours contracts, low-skilled work, the threat of redundancy used as a management tool: all of these aspects of modern working life demean and undermine the self-respect of the average working British person.’

McGovern’s party’s reaction to what it sees as a loss of dignity is to try to tighten up the labour market. This is not something that necessarily helps people struggling with their self-respect, though, if it means they cannot remain in employment at all because employers do not have sufficient flexibility to be able to take on workers.

But those workers need to feel as though the Conservatives offer them something, too: currently Labour leads the field on the language of compassion. There are some noble exceptions, and not all of them are the usual suspects. Michael Fallon, for instance, frets about the impact of inflexible employment conditions on what he sees as the scandal of youth unemployment. Iain Duncan Smith is working on plans to increase the amount of support and training available for people who have just moved into work so that they improve their skills and can move from ‘underemployment’ in an entry-level job and up the jobs ladder. That sort of focus on dignity is essential in the run-up to an election that Labour wants to make about living standards.

Subscribe to The Spectator today for a quality of argument not found in any other publication. Get more Spectator for less – just £12 for 12 issues.


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