Rebecca Lowe is Director of FREER — a new initiative promoting economic and social liberalism.
Whether it’s support for junior doctors, criticisms of vice-chancellors, or arguments about gender comparisons, the topic of pay resounds. This is unsurprising, in that work — basically, recompensed effort — is central to the life of most adults.
On one understanding, we’ve never worked more: the ONS’s latest monthly UK labour market bulletin shows, once again, that employment is at a record high and unemployment is at a record low. Yet the nature of the work in which most Britons are engaged has changed vastly over the past centuries, and technological advancement, globalisation, and new political attitudes will surely affect the future place of work in our society.
Just last week, Mark Carney spoke at the Canada Growth Summit about the job losses expected to come from increased automation. Such fears have no doubt been around since the creation of the axe. The standard rebuttal, of course, is that human workers have survived increased machine competition before, and will do again. The economist Branko Milanović has a neat three-point argument to this effect: new technologies create new jobs; new jobs satisfy new needs (though this might be better put as “new desires”); and our knowledge of the resources available to us is limited by our level of technology.
Nonetheless, alongside concern for those lost along the way while the economy responds to change, Carney’s fears about automation remain grounded in the fact that, while the past provides helpful signposts, we can never predict the future. And, robots aside, what about the way in which the “social dumping” of globalisation reduces lower-skilled workers’ opportunities in local labour markets? And the erosion of incentives to work that might come with increasingly widespread agreement about the value of replacing welfare systems with the provision of universal basic incomes?
Not only do we need greater clarity regarding the world of work as it currently is — whether regarding questions of pay, fair access to the labour market, or the value of certain skills over others — but we also need to ask how central work should indeed be to the individual, and to society as a whole. These two needs are pressing and interrelated.
The recent pay-gap discussion is an excellent example of the first need being fulfilled: a vital public service has been provided by certain commentators, not least Kate Andrews, in clarifying the significance of the results of the government’s new reporting measures. Awareness of the measures’ failures has thankfully become widespread, as has recognition that it’s wrong to assume that any disparity in pay between people of different genders is necessarily a result of discrimination.
Important questions about the current situation remain, however. As Fraser Nelson pointed out recently, a key problem in accessing certain labour-market opportunities remains the cost of childcare. Sure, as he emphasised, some people want to stay at home to look after their kids, but childcare costs mean that other parents have little (rational) choice to do otherwise.
That returns us to questions about the role work should play in our society, and the way in which the state should intervene to determine that role. It is unsurprising that career interruption affects lifetime pay; longer tenure is associated with higher pay increases. Nelson suggests that this could be partly mitigated by the introduction of new tax breaks — an attractive idea, albeit one with correlative costs for other workers (and an opportunity that would only be beneficial to parents earning over the taxable threshold).
Another option is increased flexibility: it seems highly inefficient that, each working day, most people travel to and from an office (often incurring high costs in doing so) in order to sit sending emails to each other. Recent research by Timewise suggests that 54 per cent of the workforce currently “works flexibly in one way or another”, but that “there’s still a huge gap between supply and demand for flexibly advertised jobs”, and that there are “another 8.7 million people who […] would like to if the jobs were there”.
The parents I know tell me there were decent periods of time in the first few years in which they could have been getting on with work at home while looking after their children, if their employers had allowed that. Again, widespread uptake of such an approach would affect others (not only children, but also co-workers, childcare professionals, and so on). But these are the kinds of trade-offs that need to be considered in our changing world. And whether it’s employers and employees who lead the conversion, or the state, depends on the kind of society we want to live in.
To my mind, once some kind of base fairness has been established, then it’s best to leave cultural transformations — such as those related to the length of the working week, or whether it becomes normal to work from home or to be self-employed — down to demand, as driven by the aggregation of individuals’ informed choices. We can argue all day about what that fairness might entail, though: is it enough to set an equal pay law, as the UK did in 1970? Is equality of opportunity ever possible? What should we do when workplaces intrude into our personal lives, by policing our social media activity, for instance? (Check out Private Government: How employers rule our lives and why we don’t talk about it, by Liz Anderson, for a comprehensive take on that question.)
The problem remains, however, that, while we might ascertain the truth about the present, and come to some agreement about what should be the case and begin to make it so, we cannot predict the future. Maybe robots will take our jobs, and we will be left impoverished and unfulfilled. Maybe robots will take our jobs, and we will reap the economic rewards of their progress, and reach new levels of fulfilment through our increased leisure time.
One thing that’s clear, however, is that all this is about much more than simply pay. Sure, work’s most obvious benefits are instrumental: in base terms, income is valuable because of what can be done with it, and the potential or power afforded by that. And individual progress adds to societal progress in terms of increased economic potential, and other societally beneficial outcomes. But there are other advantages related to working. Work can give the individual a place in society, equating to the gaining of dignity, respect, and a sense of community — things that, on most understandings, are central in a good society — as well as the sense of achievement that comes from a chance to use and improve one’s skills.
So, let’s not waste time on virtue-signalling criticisms of the highly paid, or panicking about the coming robot takeover. Rather, let’s take advantage of something our automated friends don’t (yet) have, and think more deeply about the kind of society we want, and the place work should play in it.