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Thursday, November 12, 2009

It's time Britain abolished unemployment

This article of mine appears in The First Post.

When the phrase 'Labour isn't working' was made famous by the Saatchi and Saatchi poster which helped Margaret Thatcher’s Conservatives win the 1979 general election, around 1.4m Britons were out of work. Today, the official number of jobless is 2.46m. But with around 8m Britons classed as economically inactive, it’s clear that the official unemployment figures are a vast underestimate of the people who could work but who are without jobs.

Most disturbing of all is the level of youth unemployment which has risen to 19.8 per cent, an all-time record. The cost of having so many people economically inactive is enormous. In 2007, when unemployment was officially 1.7m, it was estimated that unemployment was costing the taxpayer £61bn a year in benefits and lost tax revenues.

Yet while opposition politicians are quick to condemn the situation as a 'national disgrace', the solutions they - and the government - are putting forward to solve the problem are timid. All talk of their aim to reduce unemployment. But why not do something really radical and abolish it all together?

Abolishing unemployment and guaranteeing everyone who is physically able to work in Britain a job on state-sponsored programmes, would bring substantial benefits to the economy and to society.

Instead of paying people not to work, the jobless would be employed on government projects - carrying out much needed work to improve the national infrastructure, which would add to the national wealth. Critics would no doubt say that such a scheme would cost too much money in the short-run, but the sums involved would be nowhere near the £1.2tr that the government has already spent to keep bankers in their jobs.

The government would receive tax revenues from the newly employed workers and the extra purchasing power of millions of Britons would stimulate economic growth. Not only that, there'd be other significant savings as government spending on the costs of social breakdown would be greatly reduced.

In their book Criminal Identities and Consumer Culture, Steve Hall et al describe how, after the shipbuilding yards closed down in the 1980s, neighbourhoods in Newcastle and Sunderland were transformed from 'well ordered' communities into crime-ridden sink estates plagued with social problems, including widespread drug abuse. It's a depressing pattern of social breakdown that's been repeated across Britain over the past 30 years.

Today, the problem of unemployment is affecting Britons of all social classes. The middle classes avoided the worst of the job-shedding in the Thatcher years, but now they're losing their jobs in large numbers too.

You can read the rest of the article here.


Elmo Lindström said...

Guaranteed employment has been the most effective social safety net that has ever being tried.

In the 1940s when the rest of the world was at war, Sweden had such a safety net - the armed services.

Those with low eduction, no skills, and without the social skills to work elsewhere could always be accepted for some role in the country's defence force that had to be prepared in case we were invaded by the Germans.

Many poor black Swedes, as well as some white Swedes, who had dropped out of high school for some reason were unattractive to many employers because of their lack of any high school qualifications.

These people, who back in those days did not have access to the welfare provisions they would today, were rescued from poverty by having to voluntarily join the armed services for lack of any alternative source of income.

Most of them developed important work skills and learned to be discipled as a result of the strict routine in the armed services. This did much more to better the situation of Sweden's "disadvantaged" than the welfare polices that were introduced in the 1960s have done.

Now as a solution for today's unemployed I would not advocate a large-scale military recruitment program, as this would in today's international situation serve no purpose.

We could however, set up new government-private partnership industries that are involved in environmental conservation, such as forestry, or we could even set up new manufacturing industries or agricultural cooperatives.

Having examined what happened in Britain during the 1980s, it seems that public expenditure actually increased as a result of more people depending on welfare. This cost more to public expenses than it had previously cost to subsidise "uncompetitive" industries, which had kept many people in work so that they didn't rely on welfare.

DBC Reed said...

Homeownerism reigns supreme and rides down all before it.
Politicians realised it was just too much hard work providing people with jobs and that they could get elected just by making sure that house prices rose continually,not that difficult to bring about.But as Ross Clark said in the Mail of all places Sept 2008 of attempts to prop up house prices "they are a crude attempt to buy the votes of those who already own property".Crude but effective.
Curiously,those on the Left ,new and old,cling as much onto the unearned capital gains that attach themselves to the houses they live in as do the Tories (who are the definitive Homeownerists).They fondly hope that you can have high wages ,full employment and house prices on the up.You can't: the cheap Keynesian credit stimulus sooner bolts into the easy option of real estate than the more problematic provision of goods and services.

Bob said...

Capitalism demands a certain level of unemployment; if everyone who could work could easily get a job, the bargaining power that keeps wages down would be gone. So no surprise that none of today's breed of corporate politicians is going to do anything to change that!

It distresses me that most of the public debate about joblessness focuses on people on incapacity benefit, the vast majority of whom are on it for valid reasons and don't need the extra stress and misery of further social stigma.

I think it's also worth noting that a great many of the "economically inactive", those who do not do paid work, contribute positively to society in other ways, such as voluntary work. They also tend to spend their money right away rather than save, putting it right back into the local economy (food, housing, services etc, rather than buying luxury products from overseas).

Anonymous said...

One idea I have often thought would be a good one would be to nationalise the temping agencies into a state controlled entity.

The way workers are 'casualised' and temps paid a fraction of the cost that it costs for the company to pay the agency is downright exploitation.

Agencies often 'do' nothing: they just send casuals to shift boxes for a few days enough for them to get beer money for Wetherspoons.

By nationalising these agencies apprenticeships could be re-introduced and 'long termism' become a feature.

Og course, they would not be 'temping agencies', more a labour directorate. The idea that individual agencies compete in a 'knowledge economy' is absurd.

They merely rip off the worker and create a bane of temporary employment and social problems. Man power is one of the biggest employers in the USA ( more than GM ).

'Temping' is socially bad and extremely wasteful, irrespective of the dehumanised jargon about 'human resources' which could be a term from a totalitarian regime.

Am I the only person to detest these agencies for being run by exploitative bastards who are the epitomy of Blair's 'parasite economy' ?


Douglas said...

In America, it's amazing how people manage to "magically" find work when their unemployment runs out. It's a great pity that our Congress decided to postpone economic recovery by extending unemployment.

Anonymous said...

'Jobs', Douglas?

You mean low-paid casual labour in the service sector, don't you? 'Jobs' that pay so little, and are often so far from where the individual lives, that they provide nothing like a living wage. I have visited and worked in the USA, and I have seen individuals working from 6am to midnight in three or four jobs, and scared of dismissal if they take a day off sick.

I remember one woman collapsing on the floor in to clean our motel room in Orlando. She had flu, but would have been replaced had she taken the day off. Anyone who thinks the USA is a model for industrial relations should read Barbara Ehrenreich's 'Nickel and Dimed'. In many cases working life in the USA is unfit for human beings.

- questionnaire

Elmo Lindström said...


Exactly the same thing happens in Sweden. You get 320 kronor (about $32) a day for 300 days and then you get nothing. Most people who are out of work claim their full 300 days of benefits while at the same time claim that they can't find a job. Then when the 300 days are almost over they suddenly have found a job.

jock mctrousers said...

Douglas - Is that a fact? Have you got some evidence of that? Some respected economists like Michael Hudson and Paul Craig Roberts think the real US unemployment rate may be maybe 3 times higher than official figures, BECAUSE when unemployment benefit runs out the government just doesn't include them in the statistics anymore. You think no-one could survive without unemployment benefits? Do you really think anyone could survive ON these pitiful benefits - you know, if you think about it, that they're not enough to pay rent and power and buy food. Those millions, maybe 10s of millions, are working 'off the cards' when they can get it, stealing, scavenging, dealing drugs, sleeping in their cars or outside when they can't get a cheap room, or increasingly in America's gulag prison system. Any you think this is too kind, encouraging fecklessness? Maybe one day you'll have an illness that bankrupts you and loses you your job and maybe you'll be too old to get another, or there's a 'downturn' in your line of work - what if your 'true grit' isn't enough? Have you got a guardian angel? Good ol' USA!

Anonymous said...

So, Elmo, you work at an unemployment office, do you? Or in some other capacity where you have constant contact with large numbers of unemployed people? If not, where do you get your evidence? A few stories you've heard in the bar?

Even if some people do this, do you really blame them? The number of people willing to carrying on doing menial degrading low-paid work whilst bankers pay themselves small fortunes never ceases to amaze me. They do not revolt only because they are atomised and anaesthetised by the mass media.

- questionnaire

Elmo Lindström said...


In response to your question.

In my old job I worked in the records office at an IKEA store. We examined the histories of job applicants and I found out about the lengths of time that they had been receiving welfare from the social security office. It was here that I found out that most people spend their full 300 days of welfare benefits before looking for a new job.

I agree with you that people should be paid decent wages.

PS. Last year I was made redundant at my job at IKEA and I now work in a car repair workshop that doesn't pay as well as the old job.

Anonymous said...

So in other words you worked at a place that was a natural destination for the type of person you are talking about. In your mind you have expanded this part into the whole.

To make such an assertion you need a cross-section of the whole population. If you did some proper research you would realise that you are substituting a cultural problem for a structural problem - capital no longer requires labour in the West and cannot pay living wages to large numbers.

If you want to continue to work for lower and lower wages that is your decision, although it does not seem like you had much choice in the matter, which tends to reinforce my point.

Nothing will change for the better in this world because people like you are prepared to put up with the worst, and you expect everyone else to do the same.

Anonymous said...

Cartels (which means corporations, labour unions, governments and other selfish economic groups) must be disbanded if workers or anybody are going to have a prosperous life. As long as a monopoly exists, there will be corruption and oppression.