Fall in UK unemployment rate but concern for record number of Britons in low-paid jobs
Recent figures from the Office of National Statistics show that for the first time since the recession of 2008, the number of unemployed people in the UK has fallen below two million. The rate of unemployment currently stands at 6 per cent, it’s lowest in six years. Esther McVey, the Employment minister, attributes the positive news to various schemes the government put in place to tackle unemployment in the UK. She believes that the “government’s long-term economic plan to help businesses create jobs and get people working again is proving successful”. According to data from ONS, the largest fall in unemployment has been seen with young people (18-24), down by over a quarter of a million since last year, followed by women, who have seen an increase of 46,000 available jobs in the three months to August. However, Frances O’Grady, TUC general secretary says that many jobs created since the recession are low-paid, casual and zero-hours.
Concerns remain for the number of Britons working in low paid jobs, and who earn less than two thirds of median hourly pay of £7.69 an hour. According Resolution Foundation, a non-partisan and award-winning think-tank, this number rose by 250,000 to 5.2m last year. Warren Ruhomon, senior market analyst at finspeads.com says that this poses a “significant area of concern” in the UK labour market as current prices of goods and services is more than the average wages of individuals. This sentiment was echoed amongst 80,000 to 90,000 members of TUC who protested earlier this month opposing the below-inflation 1 per cent pay offer from the government.
Additionally, The Resolution Foundation’s chief economist, Matthew Whittaker believes that a growing number of people in low-paid jobs also poses a serious problem for the government as “it fails to boost the tax take and raises the benefits bill for working people”. He believes that the way forward to tackle the issue of low-pay is by looking at the “kind of jobs being created in the market, the industries contributing to the growth and the ability of people to move from one job or sector to another”. He also agrees that raising the minimum wage could help the lowest paid workers but a “broader low-pay strategy is required in order to lift large numbers out of working poverty”.
NHS workers strike for the first time in 32 years
Thousands of NHS workers staged a four-hour strike in England for the first time in 32 years, protesting against the 1 per cent pay rise offered by the government. Workers want the pay rise to be applied uniformly across the board and not just for those who do not receive an incremental rise linked to performance (which averages about 3 per cent each year), but Ministers in England have argued that the government could not afford a uniform pay rise as it would lead to substantial pressure on trusts and job losses. Unions have described the offer as “appalling” and that their “staff are being treated “shoddily” by the government.
All this comes at a time when morale is low amongst NHS workers. An internal survey reported that more than 1,000 paramedics left their job in 2013/14, almost double the number during the same period two years earlier. Additionally, three-quarters of paramedics have considered leaving their job in the last 12 months due to “increased demand which meant workers were under pressure”. However, Jeremy Hunt, the Secretary of State for Health insists that a 1 per cent pay rise to people who are already getting an average of 3 per cent every year would mean laying off staff in the NHS, which under the given circumstances would not be the right thing to do.