[IER] Outlook "dreadful" for workers after Autumn Statement
Sarah Glenister
sarah at ier.org.uk
Fri Nov 25 16:33:59 GMT 2016
IER News Brief 25/11/16
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news brief
Friday 25th November 2016
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The outlook for wages is <http://ier.us12.list-manage.com/track/click?u=f121e48a8bb6d3101590c12d3&id=f3fddeefc5&e=71131c031b> "dreadful" after the Office for Budget Responsibility's (OBR) gloomy projections at this week's Autumn Statement.
This is according to two think tanks, both of which forecast a slowdown in wage growth that will take the nation back decades. The Institute for Fiscal Studies warned that workers can expect real wages to remain below pre-recession levels until at least 2021, saying the depression in earnings seen in the last decade is the worst seen in the last 70 years. The Resolution Foundation said the decade to come is now set to be the weakest for wage growth since the 1900s.
The OBR also warned that the UK's historically low economic productivity (in comparison to the G7) is set to continue. The UK's so-called productivity puzzle is a key concern for economists, as it is holding the UK back from a strong recovery from recession as well as leaving it vulnerable to further crises in the future.
Many have pointed to a fall in trade union activity since Thatcher reorganised the economy in line with a neoliberalist agenda, which has led to a climate in which employers compete by undercutting wages and conditions rather than by improving the quality of their output (a key factor of economic productivity).
Steve Hill of the Open University this week argued that one driver for low productivity is the lack of training <http://ier.us12.list-manage1.com/track/click?u=f121e48a8bb6d3101590c12d3&id=b6191c2421&e=71131c031b> available for today's young people. His position chimes with that of the Social Mobility Commission <http://ier.us12.list-manage1.com/track/click?u=f121e48a8bb6d3101590c12d3&id=6035b85540&e=71131c031b> , which noted a shift towards low-skilled and low-paid jobs and a lack of opportunities for progression is trapping people into low earnings.
The Institute of Employment Rights' Manifesto for Labour Law <http://ier.us12.list-manage.com/track/click?u=f121e48a8bb6d3101590c12d3&id=82b8bc84b4&e=71131c031b> - 25 policy recommendations adopted by the Labour Party - addresses these issues, calling for a restructuring of labour law to focus on collectively agreed wages and conditions rather than statutory minimums.
Keith Ewing, President of the IER and Professor of Public Law at King's College London, explained: "Policy over the last 35 years has focused on destroying collective bargaining, making it easier to hire and fire workers, provide them with insecure positions such as zero-hour contracts, and pay them low wages. This has led to a business model reliant on churning out low-quality services and products and disposing of, rather than training, existing staff. We know this reduces productivity in our economy, and low productivity leaves us vulnerable to financial collapse."
For more on our Manifesto click here <http://ier.us12.list-manage1.com/track/click?u=f121e48a8bb6d3101590c12d3&id=9b174cd4e5&e=71131c031b> to take a quiz on workers' rights, read a summary of our key proposals and quotes from union leaders in support of our aims, buy the publication, and donate to our Project Development Fund.
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