Conservative MPs seem to be spoiling us at the moment. Every other day another one comes out with a new tip for surviving the highest rate of inflation on record. The latest gem is from the Home Office minister Rachel Maclean who, instead of providing solutions for the “short-term” pressures on people’s budgets, said that to “protect themselves better” in the long term people should be “taking on more hours or moving to a better-paid job”.
When pressed by Sky News’s Kay Burley on the examples of people working three jobs yet still having to visit food banks, Maclean doubled down. “Of course it’s not [straightforward],” she conceded. “We have often heard in the past when people are facing problems with their budgets that one of the obstacles — and it may not be for everybody — is about being able to take on more hours, or even move to a better-paid job.”
While Maclean was careful to say that different workers would have individual circumstances, she didn’t acknowledge the key problem with her survival tip. In-work poverty — perhaps the most inconvenient phrase for Tory ministers worshipping the emancipatory potential of work — has hit a record high of 17.4 per cent. Work, more so than ever, doesn’t pay.
This has been pretty clear to me in my reporting over the past few years. I have spoken to people who earn below the minimum wage in the gig economy, have to work multiple jobs to get by, or try to fit shifts around parenting because of the sheer expense of childcare (the UK has the third highest childcare costs in the developed world).
For example, I heard recently from one worker in Coventry for the Department for Work and Pensions itself who struggled to earn enough to live on. She earned £36 a week more than the minimum wage (£9.50 an hour) and since last October had been working overtime: six days a week for three out of every four weeks. With her gas and electric bills rising, as well as the cost of her drive to work, plus the mortgage and other outgoings, she was “only just breaking even” and having to “live in my own personal lockdown to avoid spending”.
“It is so very wrong,” she said. “I really am scared of what more there is to come. I would not be able to eat if I had to rent. It would take one big thing to put me in debt. I can’t see them giving us a pay rise. It’s grotesque.”
A fact that Maclean is probably missing with her simplistic solution is that about 40 per cent of Universal Credit claimants are actually working already, and for every pound they earn above the work allowance their Universal Credit payments are reduced by 55p. This aspect of the welfare system got Thérèse Coffey, the Work and Pensions Secretary, into hot water last September when she similarly suggested that claimants simply work two extra hours to compensate for the government cutting the £20-a-week Universal Credit pandemic uplift (because of the taper rate back then, they would actually have had to work five extra hours to earn that money back).
Last of all, even if it did always pay to work longer hours, it’s not as simple as “moving to a better-paid job”, as Maclean suggests. Despite the high number of vacancies, the labour market is still very competitive for certain workers, particularly at the lower-paid end. In a third of local authorities in England, there are two jobseekers chasing every one vacancy, according to research by the Local Government Association. And two thirds of unemployed jobseekers are from occupations in which the competition for jobs is at least 10 per cent higher than it was prior to the pandemic, as revealed at the end of last year by the Institute for Fiscal Studies.
So no, working longer is not a realistic answer to this crisis — as a short-term fix or a long-term plan. Time, perhaps, for the minister to put more hours into exploring the twisted reality of modern work.
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