Falling Through the Cracks: Insecure Work and the Social Safety Net

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Yves here. Even though this post is written from a UK vantage, it draws on work from Australia and the US. Be sure to read the section that discusses the mental health impact of having a decent job, a poor quality job, or no job.

By Jane Mansour, an independent policy consultant specialising in work, active labour market policy, and adult skills. Originally published at Open Democracy

Vulnerable employment, with workers experiencing high levels of precariousness, is a global phenomenon. The ILO projects global growth in vulnerable forms of employment to grow by 11 million a year. The impacts of this are being felt across developed, emerging and developing countries.

In the UK, much concern about the changing labour market has been framed in terms of the shift in risk that has occurred between employers and individuals. The gig economy is often used to epitomise the imbalance in power between those controlling the technology, and those carrying out the tasks:

However, this shift of risk reaches far beyond Uber drivers and millennials on bicycles. It can be seen in the use of contracted, agency and temporary staff and in the unpredictability of zero and minimum hours contracts of those working for supermarkets, in warehouses, in social care and in universities.

The impact of this on people’s lives is exacerbated by a parallel transfer of risk in the systems set up to support those who are unemployed or in low paid work. At the same time as work has become less predictable, the safety net has become less springy and with bigger holes.

This shift can be seen in cuts to social security, in the changes and increasing conditionality that universal credit brings, in the way jobs are measured and impact on poverty is not. It is seen in adult learning and the introduction of adult learner loans. It is also seen in a childcare sector that does not have the capacity to offer care to those with unpredictable or non-standard hours, even though those are the jobs increasingly likely to be available for those on low pay.

The Changing Nature of British Poverty

The composition of those in poverty in the UK is changing, and increasingly people in poverty are to be found in working households. Both real wages and living standards are predicted to fall over the next few years in a way that is highly regressive, as prices rise and employers are unable or unwilling to offer higher pay. Getting people into work has been the biggest anti-poverty policy of recent decades – millions have been invested by successive governments in active labour market programmes to deliver job outcomes for those on benefits, millions more on evaluating their impact. However, such evaluations have not focused on measuring the programmes’ impact on poverty reduction.

The policy focus on work has been underpinned by evidence that demonstrates the value of employment for both physical and mental wellbeing. Indeed, the ‘work programme’ is now being replaced by the smaller ‘work and health programme’.

However, the quality of work is central to broader positive outcomes. Research from Australia has shown the importance: “Getting a high quality job after being unemployed improved mental health by an average of 3 points, but getting a poor quality job was more detrimental to mental health than remaining unemployed, showing up as a loss of 5.6 points”. Poor quality work, whether defined by pay, security, or unpredictability is increasingly what is on offer to those most disadvantaged in the labour market. In the UK there is no metric in place to help the government understand the extent to which the very work on offer undermines the outcomes it assumes work will produce.

Examples from the US show how changes in measurement requirements, at both national and state level, can impact on labour market programme design. The 2014 Workforce Innovation and Opportunity Act required job outcomes to be above a certain pay threshold in order to be counted. The current model in the UK would need rethinking if Jobcentre Plus and other employment providers had to meet a similar quality proxy for the jobs they place people in.

New York City has a career pathways model, developed with a broad group of stakeholders, including unions, providers and employers. It provides a framework that meshes employment and skills systems, measuring job outcomes based on pay.  The UK’s new metro-mayors, elected last week, with their wider geographical remit, offer an opportunity for a similar redesign, but it will require bolder demands for control of funding, and measurement mechanisms from the mayors themselves.

Guidance Needed

Lack of pay progression is a significant issue for adults in low-paid work. The high marginal tax rates experienced as in-work benefits are withdrawn mean that a promotion may mean more stress, less flexibility, and very little immediate financial compensation. Employment support tends to focus on ‘entry’ jobs from benefits, so few jobseekers benefit from advice on how to use jobs as stepping-stones to better pay.

Indeed, the evidence shows the most effective way to increase earnings is to move jobs. However, this brings risks for the individual and so requires them to have confidence in the social security safety net in case moving doesn’t work out. This confidence is eroded by increasing conditionality, logistical administrative lags, asymmetric information and the lack of honest discussion abut the impact of low pay and insecurity at the bottom end of the labour market.

This lack of information is compounded by changes to access to training. Employers are more likely to invest in training their higher paid, (and already high-qualified staff) than those in entry-level roles. Indeed, many large public and private organisations continue to outsource their security, administration, maintenance and reception roles, so those staff may well work under very different terms and conditions to those directly employed by the organisation.

People in low wage jobs, wanting to improve their skills in order to support progression are now expected to take out ‘advanced learner loans’ to fund their own training. This ‘risk swap’ combined with significant cuts to the further education budget and poor information from learning institutions on the financial and labour market returns to the courses they offer, has seen a fall in the number of adults accessing education and training.

In the US in Washington state, the Workforce Board tracks results (numbers into work and earnings) and taxpayer return on investment for 12 programmes which, between them, account for over 98% of the federal and state dollars spent on workforce development. This level of data is not available in the UK, so it is much more difficult to understand what works and how.

The Work and Pensions Committee have been examining self-employment and the gig economy. They have noted the gap between Jobcentre Plus provision, universal credit, and self-employed claimants. One of their recommendations was the need for more specialist advisors and support for those working in this way. However, provision of support for all claimants (both in and out of work) needs to be reviewed in the context of labour market changes. This review needs to take account of how jobs are measured, access and information about adult learning, as well how technology enables support to be delivered differently. In France, Macron’s employment programme addresses the social cost of precarious jobs by proposing employers using casual workforces bear a financial cost. The incentives in the UK run in the opposite direction.

There is scope, in better delivery of work support, to challenge the atomisation and isolation of workers and the loss of social capital and networks of new working models. The precarity of insecure work needs to be addressed, rather than exacerbated, by the systems set up to support people through their working lives. In roles where working hours are flexible or unpredictable, the division between private and public lives can be complex. The interaction between the individual and the state needs to understand that complexity and support people to navigate through their working lives rather than leaving them without a compass or adequate map.

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  1. Disturbed Voter

    Survival is optional. Complacency is risk inducing. Politics as usual is suicide.

    Form new political parties, disestablish the existing political parties. Changes to business law can happen, and that can impact survival in a positive way. The rich aren’t the only threat, they are nothing without the enabling Middle Class. It is probably a good thing that if the white collar won’t help the blue and pink collar, then the white collar need to be unemployed too. If the rich are unwise enough to build up a proletariat … then so be it.

    1. Colonel Smithers

      Thank you, DV.

      The rich still have enough white collar support, but that neo-liberal monster is moving up the food chain to the white collar wearers. From my UK perspective, and perhaps that of France, too, as I know the country well, it’s interesting to see what were solid middle class / white collar jobs become precarious. I recall conversations with City colleagues from 2004 to 2009, all of us wondering what we could do if we lost our jobs. Some thought about teaching. One said about becoming an apprentice plumber to his brother in law in Kent.

      It was OK for the middle class when miners, steel workers, shipyard workers etc. were thrown to the wolves. Some of the middle class and what neo-liberal Tories and New Labour called aspirational voters even revelled in the Schumpeterian creative destruction and started to bandy the phrase around to show how right on they were. Well, there are no more miners etc. to sate the appetite of neo-liberalism, so white collar workers will have to do for that altar.

      A year ago, just before I left the blue eagle’s nest for its German twin, the eagle made a third of its legal staff, all qualified lawyers and at AVP and VP grades, redundant. Some of the work was transferred to India. Apparently, none of those made redundant has found permanent employment. Many were in their thirties or forties and had young families and student loans to pay off.

      1. PKMKII

        The rich still have enough white collar support, but that neo-liberal monster is moving up the food chain to the white collar wearers.

        Which explains why so much of Bernie’s vocal support came from young, white college-educated folks. They’re the members of the white collar wearers that the neo-liberal monster is going after first. Went through the college ritual like the older members of the WCW, but unlike their seniors are saddled with way more student debt. Come into a leaner workforce with fewer opportunities, less stability, making less (inflation-adjusted) than the elder WCW. They’re making what was blue collar pay a generation ago, while having to put up with the white collar pomp and circumstance. Meanwhile, the older WCW chide them, “Stop being entitled! I started in the mail room and look where I am now!”, never mind that the mail room was replaced with one IT monkey maintaining the e-mail server a long time ago.

        1. Arizona Slim

          I experienced the same letdown in the early 1980s. Which is why I also was an ardent Bernie supporter.

  2. Colonel Smithers

    Thank you, Yves.

    It’s good that you mention the ILO. The body has done a lot of good work, especially when led by Heiner Flassbeck, a German Social Democrat who fell foul of the SPD’s neo-liberals, just like Oskar Lafontaine.

    Your mention of the ILO reminds me of a conversation my parents had with an ILO official about thirty years ago. All of us were on holiday in the south of France. We had driven from England. The ILO official and his family had driven from Geneva. I was a school boy, so was not paying attention to what the adults were talking about, but one comment / forecast has stuck with me. The official thought that Maggie Thatcher’s labour reforms, designed to weaken what the Tories and others thought to be “bolshie” workers / trade unionist, would lead to management looting company coffers and a decline in employee living standards and health. The official added that he thought UK workers had the least labour and social protection in the developed world.

    “Indeed, the evidence shows the most effective way to increase earnings is to move jobs”. This comment applies to front and middle office City jobs as much as others.

  3. Kalen

    Thank you. Another great subject missing most everywhere however those so-called remedies or attempts to alleviate the problem are (as decades long experience showed) so flawed mostly because they miss the fundamental cause of the continuing pauperization of the poor and destruction of middle class as purposeful and desired neoliberal policies of the world governments effectively commanded by Global oligarchy and hence none of those proposal would ever work at all since these are against stated murderous policies of the establishment.

    Who must be condemned are those who shift blame on the victims and peddle so-called individual “fiscal responsibility” as the only criteria of judgment of human being ignoring direct cause and effect between the system itself run by so despised corrupted government serving oligarchy and social outcome of poverty and desolation and instead mostly blaming victims of this abhorrent regime themselves unaware what the hell is really going on and why people are homeless and jobless in 99% of cases and why they do not have to suffer.

    As of psychological damage to the people:

    John Stuart Mill:

    “Government shapes our character, values, and intellect. It can affect us positively or negatively. When political institutions are ill constructed, “the effect is felt in a thousand ways in lowering the morality and deadening the intelligence and activity of the people”

    How can we expect anything from government programs when homelessness and joblessness both are integral part of any capitalistic system defended by the very government, a system of legalized discrimination and sociopolitical exploitation of one man by another man under guise of law of property and rampant individualism meaning abandonment of community and its commons and its interests. The human catastrophe of poverty is not a failure but a distinct, and revered by ruling elite, profit making feature desirable by oligarchic class since it is used to threaten and intimidate the rest of the workforce into wages of slavery.

    And hence, we should not even try to solve overall poverty, joblessness and homelessness problem within this system, it is impossible.
    And those misguided do-gooders and feel-gooders who try it through dead end partisan politics, or some meek government programs that are nothing but a conduit for massive fraud and theft of taxpayer money by bureaucrats, or disgusting fraudulent charities that pay their directors millions $ or subversive NGOs, pushers of hatred filled identity politics are all simple phonies, cruel pretenders, who simply cover up the scope of human catastrophe and pay lip service to real problems and solutions remaining out of sight and scope of their corporate sponsors’ funding intentions, often same sponsors that are causing massive social ills.

    Instead, we must realize that there is no poverty or homelessness or joblessness and there is huge need for helping hands, for professionalism and hard work to restore our dilapidated towns and cities to improve our standard of living, to just build caring communities based on personal relations of compassion, empathy and solidarity un-negotiated by money and profit permeating social life of today.

    1. Norb

      The question is how to build caring communities. Civic organizations are needed to gather the people together in order to build the things you talk about. Organizations that allow the pooling of resources to reach the desired result. This is true investment.

      The spirit of what you say is right on. Greed and corruption can only be combatted by acts of compassion. It will take a truly revolutionary spirt to overturn the neoliberal order.

      Compassion is the foundation of revolution.

  4. templar555510

    I recently saw that Charles Murray supports the idea of a Universal Basic Income ( and the removal of ALL social security ) and this is an idea, I think , who’s time is about to come . It’s not a an old paradigm ‘ Left -v- Right ‘ issue anymore. Neither is it any kind of panacea for the socio-economic difficulties we now face – as this piece says – globally, but I think it is a necessary first step . As ever the devil is in the detail.

  5. CD

    How about some other effects of work insecurity and a poor safety net?

    Such as poorer health and therefore higher medical costs for the society? More family problems such as abuse of family members, drug and alcohol abuse, and divorce? Shorter life expectancy?

    This is just a short list.

    1. Colonel Smithers

      Thank you and well said, CD.

      I don’t think the neo-liberals price in these externalities. It’s our / society’s problem, not theirs. Neoliberals probably think these costs are a bonus as they distract attention from who are responsible for this criminal state of affairs.

      Mum works in local government in Buckinghamshire, an apparently well to do and true blue county. Dad works as a doctor in / around the Thames Valley region, including our home county of Buckinghamshire (think Connecticut if in the US). (Both are 73 in November, which tells you another story.) The problems that you have highlighted are spinning out of control there and have a hereditary element to them as well.

  6. Democrita

    Rueful laugh to read that laid-off lawyers thought teaching might be a solution. Teachers–and journalists–were among the first white-collar jobs to go precariat. I submit one of tptb’s priorities was to diminish the power of anyone trying to speak truth rather than propaganda.

    I continue to be amazed at how many of the ten percenters don’t see it coming.

    1. Colonel Smithers

      Thank you and spot on about the 10%, Democrita.

      With regard to journalists, the failing Guardian (a UK broadsheet that is burning through cash as if it’s going out of fashion and on track to go bust by the end of the next decade on current trends) employs many “journalists” on zero hour / gig contracts, one way of keeping them in line. The operating company, based in an area of London (King’s Cross / St Pancras) that has been transformed in the past two decades, is thinking of moving some operations to its original home of Manchester to cut costs.

      1. catsick

        As a kid we read the Guardian and my father occasionally wrote for them and it was a solid left of centre read, on my paper round it was all sun,mirror and daily mail. In the past 10-15 years the paper has done a 180 degree shift in its ethics and politics just as has the economist, both now are solidly behind any war the neo-lib-cons want to wage, Corbyn is the antichrist and only Putin could be worse, I would love to hear the inside story of how a trojan horse came in and swept out the old left wing values for a very sinister creed from the other side of the Atlantic .

    2. jrs

      well a link posted here said that law was voted single most boring job (80 some percent of lawyers were bored with their job), so they might be less bored if they managed to land something else. Security is another matter.


    Nothing makes me want to vomit more than neoliberals touting “job training programs!” as the solution to all our employment woes. Like any employer is going to say “Hey, were going to give this position to an H1-B visa/entry-level college grad/robot, but this 40-something took a 6 month training course! Sign him up!” Only thing that’s going to make those workers more attractive to employers is more employment history, which means giving them jobs.

  8. edward cloonan

    it is amazing that so many liberals continue to pretend they can band-aid capitalism–it can not be reformed

  9. Anonymous

    In response to Colonel Smither’s comment that:

    ‘the eagle made a third of its legal staff, all qualified lawyers and at AVP and VP grades, redundant. Some of the work was transferred to India. Apparently, none of those made redundant has found permanent employment. Many were in their thirties or forties and had young families and student loans to pay off.’

    About ten or fifteen years ago Cisco decided to reduce the size of its legal staff by half through automation. Their chief legal counsel has spun this as:

    ‘he has used automation of repeated legal tasks to greatly reduce the legal department’s burden on the company as a whole’

    My local attorney is now using lawyers as clerks. Why anyone goes to law school today is a mystery to me.

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