You know the problem with you Britons? You’re all lazy. If you just worked a bit harder, there’d be no cost of living crisis.
I’m sure there’s a part of Boris Johnson that wants to say this, perhaps in more flowery terms, but you get my drift. He probably would be saying it if he was still penning his verbose columns. Some of his colleagues actually did say it (more or less) in the now-infamous Britannia Unchained which claimed that “the British are among the worst idlers in the world”.
Work hard, get on, solve your problems, solve the nation’s problems. It’s a favourite Tory line. So the Guardian’s report that Number 10 is planning to focus on work as the solution to the cost of living crisis over the weekend shouldn’t come as a surprise. The problem is that it won’t work. The numbers will show us why.
Another story over the weekend came courtesy of Michael Lewis, the boss of energy giant E.On, not the personal finance campaigner. He predicted that 40 per cent of his customers would be in fuel poverty by the autumn. Others have expressed similar fears.
It goes without saying that many of those customers will be in some form of work, or at least in a household where someone is in some form of work. The UK’s employment rate currently sits at 75.7 per cent.
But wait, the number of vacancies currently outstrips the number of unemployed people who are seeking work (per the most recent update from the Office for National Statistics). If they were to take on extra hours, and/or extra jobs, we could solve the problem. Huzzah!
A big issue with work in Britain is that it doesn’t always pay. Remember when Rishi Sunak, the chancellor, the richest MP in the House of Commons, and newly minted member of the Sunday Times Rich List, cut £20 from universal credit (UC)? Therese Coffey hurried over to BBC Breakfast to say this represented only “two hours’ extra work every week” for claimants (because you can work while on UC). The government, she declared, would help people get the extra hours they needed.
It didn’t take long for the Resolution Foundation, a think tank, to highlight the crucial flaw in her argument. A minimum wage worker (£8.91 at the time) on an annual income of £6,100 a year would have actually taken home just £6.60 for two hours work in the immediate aftermath of the cut because of the taper that reduces the level of benefit for every extra hour worked.
That sum would have fallen to £4.48 if they were paying tax and national insurance, and to £2.24 an hour after taking into account additional childcare and/or travel costs. Turns out, a UC claimant would have needed to work nine extra hours, not two as Coffey had claimed, to make up for the removal of the uplift.
The maths may have changed a little bit today, but the problem remains essentially the same. Extra hours won’t fix this. What about an extra job? Some people are already in that situation, taking on second, even third jobs in the evening or at weekends to cover their bills and keep food on the table. Others may be considering it as an option, but it is a fairly awful one.
Isn’t this good news for the economy, given the labour shortages it has been experiencing? The trouble is that this country has a skills shortage. Acquiring new ones and bettering yourself by finding a better paying role is not something you can do if you’re trying to manage two or three existing jobs.
However, the biggest problem with trying to solve the cost of living crisis with work, and people flogging themselves by taking on extra hours and extra jobs, is that there may soon be a lot less work around.
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The Bank of England thinks unemployment is going to start rising, although it may take a while for this to happen. I realise that people are currently sceptical about economic forecasts and economic forecasters. The Bank’s have looked rather like blindfolded darts players trying to hit a board after being spun around three times of late.
But it stands to reason that in a deteriorating economy, jobs will start to get cut. And the UK economy is very definitely deteriorating. Growth has all but seized up. Recession looms large. British consumers, so often its saviours in the past, aren’t going to help out this time round. They’re too busy saving their pennies to put into their electricity metres.
The best of it is that the government has itself got the unemployment ball rolling by unveiling plans to sack 90,000 civil servants. Its record on jobs may look very different in six or 12 months’ time.
Any suggestion that work could fix the cost of living crisis is a travesty. Boris Johnson banging on about how low unemployment is will not distract from the desperate struggle to pay their bills that many working people face. Once again, the government is failing working people. Badly.
Source Link Voices: Is it true that if you’re struggling to make ends meet you just need to ‘work harder’?