A further 1,000,000 UK jobs no longer fit the 9-5 stereotype since the recession began.
Not so very long ago, the thought of associating the term of UK jobs with cheap labour would have brought resounding laughter from around the executive table. With a long-term flat-lining economy, the joke is now most certainly on the workforce.
This year’s Christmas parties, for those who find anything to celebrate about 2012, will have managing directors thanking their lucky underpants that job shortages have forced the labour market rate down to such desperate levels.
Number of UK jobs rising but GDP falling didn’t compute
Despite double dip recessions being the norm rather than the exception this trading year, employment figures have continued to rise. This contradiction befuddled many economists.
That was until the correlation of both output and UK jobs rising compared with the GDP experiencing negative growth for so much of the year determined only one outcome. More output but cheaper labour to produce it.
Initial results suggest that rather than OEMs seeking to invest heavily in plant, machinery, software or property they have kept their cashflow fluid by increasing output via the cheap labour market. Not only has this tactic created unlikely growth in the number of people in work but it has also allowed manufacturers to increase productivity without tying up huge amounts of capital. The creation of UK jobs in this manner, although welcome in the short term for those desperate for employment, sets a dangerous precedent for the future.
Now that the only recognisable union in the UK happens to be in the name of our flag, trying to bring wages up to socially acceptable levels when austerity ends will be no mean feat. However, with a return to stability unlikely until 2018, based on recently revised forecasts by The Chancellor, that concern is somewhat overshadowed by more immediate issues.
Industry investment down to a sixty-year low
There are figures that confirm the cheap labour market versus investment theory. Not since 1955 have investment figures compared to national output, 13.9% for 2012, been so low. Combine that statistic with greater employment levels and the theory does more than hold water.
There have been other explanations tabled that have at least some merit. Only last week, figures released by the Office for National Statistics revealed that 10% of the jobs in the UK reflect underemployment.
In English, that means one in ten UK jobs demands part time hours (less than 20 per week) but the employees filling those roles would welcome more hours should the opportunity arise. Since the recession began, that’s an increment of 1,000,000 UK jobs being either created or downsized thus.
Another trend identified that has had a long-term effect began the last time the Tories were in power and that senile old bat had the keys to number ten. In 1977, 59% of the national income was paid out in salaries. In 2008, that had dropped by 10% to 53%.
However, the workforce’s profit share has risen over those three decades, from 25% in ’77 to a more respectable 29% now. But that still has not been enough to stave off the effects of inflation and other external forces wearing down the value of the money in our pockets. In real terms, each worker is £7,000 a year worse off now than they were the year a certain Paul Weller, ably accompanied by Messrs. Buckler and Foxton, released their first single and album, both going under the title ‘In The City’.
If Mr Weller were to pen the title track again now, I’m guessing he may have a stab at ‘In The Shitty’, which seems a whole lot more appropriate given the gloomy outlook for the UK jobs market based on this latest information.
Have your say: if you had the opportunity to work more hours, would you? Is recreation more important to you than upping your income?
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