Trade Unions Tackling Poverty
Context
After a decade of continuous economic growth, rising employment, relative affluence, investment in public services and the regeneration of towns and cities, the idea that large numbers of people in today's society are still living in poverty had, until recently, slipped from the political lexicon and public consciousness. However, rising inflation caused by increasing energy, food and petrol prices, coupled with signs of a world economic downturn has aggravated fears of a recession. In light of this economic uncertainty, policy makers are beginning to reassess whether poverty really is a hangover from our industrial past, the symptoms of which should be alleviated by public policy, or without concerted effort and radical reform is here to stay for the foreseeable future.
What is Poverty?
Before determining the causes of poverty, we first need a common definition to enhance our understanding of what is means to be poor in 21st century Britain. When asked to conjure an image of poverty most people think of Britain's Victorian past or the developing world, but as the media notes, 'poverty is all around - commuters on the bus, the colleague sitting opposite you at work, or even the family living next door.' [1]
The widely accepted 'technical' definition of poverty is having an income which is less than 60% of the national average (excluding the wealthiest members of society). On this measure, the proportion of the UK population defined as in poverty is roughly one in five. This means 'people live in poverty when they are denied an income sufficient for their material needs and when these circumstances exclude them from taking part in activities which are an accepted part of daily life in the society in which they live.' (Poverty Alliance)
By contrast, policy makers have tended to assume that poverty is an affliction suffered by the unemployed, economically inactive and vulnerable groups in society who naturally evoke public sympathy i.e. children and pensioners. As Government wrestles with how best to prioritise the needs of a whole population and target resources accordingly, perhaps increasing the employment rate to address the immediate symptoms of poverty assumes top priority and shielding future generations from the worst effects is considered the most effective way to lessen its impact over time. But this is only part of the story. For too many families, moving into work has not resulted in moving out of poverty. The purpose of this paper is to illustrate how low pay, poor terms and conditions of employment are contributing to extensive working poverty and how the economic and social cost is obscured in current debate and mounting.
Although a strong economy may have boosted employment levels, especially for women, it has not reduced high levels of income inequality that became so pronounced under successive Conservative Governments. Since the 1980s the gap between rich and poor has actually increased. The distribution of income is highly skewed, with approximately two thirds of individuals having incomes below the national average, whilst the richest continue to get richer. The top 1% of the population increased their share of income from 6.7% in 1981 to 13% in 1999 (Atkinson & Salverda, 2003).
This is born out by a TUC study which shows that over the last three decades inequality has grown rapidly in the UK so that the gap between the top tenth of the population and the bottom has roughly doubled since 1979. [2]Furthermore, the gap has not only widened over time, but is also high by international standards. This is evidenced by the Gini coefficients (a common measure of overall inequality in a society). The UK often benchmarks itself against other European countries and none of these 'critical peers' have a higher level of income inequality.
Earlier this year a report by the Institute of Public Policy Research revealed that over a fifth (23%) of employees in this country were paid less than £6.67 an hour in April 2006, which is equivalent to little over £12,000 a year for a 35 hour working week. [3]The report concluded that a labour market in which so many earn much less than the average worker is a central factor underpinning high levels of poverty and inequality in Britain - holding back both individuals, the economy and wider society. Over the last decade the proportion of households in which someone is at work but remain poor has gone up - now amounting to over one in seven. Some households have swapped worklessness for working poverty.
Where people live and work also has an important bearing on whether they are likely to be low paid. Overall, workers in the North East are most likely to be low paid and therefore the region has the highest proportion of low paid workers; 252,000, or 27.4%. With the lowest pay level across the regions, in the North East median gross weekly earnings for full time employees only amounted to £403 compared to £457 for UK full time employees. [4]
Rapid growth of the service industry, coupled with a decline in manufacturing has led to what has been referred to as a two speed economy. Since 1993 the growth in the service sector has been more than double that of manufacturing and more than 80% of the rise in UK employment has been generated by service industries. The share of employment accounted for by the service industry has also risen, from 54% in 1970 to 77% in 2000 (ONS, December 2000). This shift has boosted women's employment because women are more likely to work in the service sector, whilst exerting a depressive influence over men's employment as the majority of manufacturing employees are men. The type of work that has flourished in the service sector and boosted employment tends to be part-time, provide low job security, low pay and few fringe benefits, with the result that an increase in the quantity of employment has not been matched by quality. As both industries are vital to the North East's economic future, driving up the availability and quality of employment in these strategically important sectors is critical.
The picture is not dissimilar in the public sector, which is the largest employer of low-paid workers aged 25 or over, accounting for more than a quarter of all such low paid employees. It is even more striking to learn that this figure is only applicable to those employed directly by the public sector and could potentially stretch higher when those employed by contractors are taken into account. Restructuring, including the contracting out of tasks such as cleaning, caring and catering will have a significant impact on quality of public sector employment in the long term. Furthermore, below inflation pay rises for public sector workers actually amounts to a pay cut in real terms. Pay restraint, together with an increasing reliance on temporary agency staff to fill vacant posts will combine to create severe recruitment and retention issues towards the end of the decade. Imposing an arbitrary ceiling on wage rises in the public sector will do nothing to ease the pressures of inflation either. In fact this policy could further malign a stuttering economy by reducing demand for goods and services that are key contributors to regional growth. Given that the public sector is a significant employer in the region, accounting for a large proportion of employment, it is not only essential to address those factors detrimentally affecting productivity within the sector itself, but also understand its relationship to the wider economy. Academic claims that the size of the public sector in the North East acts as a squeeze on economic competitiveness and private sector investment have gained currency in recent years. However latest research shows there is little credence in this argument. [5]Cost of living rises in the public sector have fallen behind pay awards in the private sector. If the Government continues to draw the purse strings tighter, the prevalence of low pay will accelerate the trend towards undercutting terms and conditions and decelerate the rate of regional economic development.
The drivers of low pay are complex, rooted in low skills, poor productivity, unfairness, institutional inequalities and power imbalances in the workplace. However low pay should not be inevitable and neither can the phenomenon be attributed to the work force.
Globalisation has often been cited as the culprit responsible for outsourcing and sucking employers into 'a race to the bottom'. In 2007 a study Monitoring Poverty and Social Exclusion pointed out that only a minority of low-paid workers are in sectors that face international competition and the related threat their job could move abroad. [6]The majority of low paid jobs, such as cleaners, retail assistants, security guards and waiting staff are poorly paid for domestic, not international reasons. While the minimum wage in a single stroke has been instrumental in providing people with a baseline income, it was never intended to be an industry 'gold standard'. It is startling that a single earner in a couple family with two children would have to work almost 80 hours a week at the minimum wage in order to avoid poverty through their wages alone. [7]A number of studies have shown that the level of couple poverty would be up to 50% higher were it not for women's earnings. [8]
Without further action on low pay wages will be depressed, particularly in the lower half of the earnings distribution, while at the very top wages will continue to spiral upwards thereby accentuating inequality. More worrying still is the spread of UK jobs paid below the National Minimum Wage, which affected 292,000 workers in spring 2007. [9]
When seeking to establish a set of characteristics that defined 'Britishness' the Prime Minister recently alluded to a sense of fairness epitomised by universal support for the concept of social justice. Arguably the right to work and earn a decent living are fundamental components of a fair society.[10] Therefore it is of little surprise that Government policy should regard work and improving productivity as the most appropriate means of lifting people out of poverty. However this outcome is by no means guaranteed.
Who is at risk?
Men's risk of poverty is judged almost entirely related to exclusion from the labour market. Although tackling economic inactivity remains a primary challenge, especially in this region, it is crucial public sector agencies realise that people returning to work are not always assured a sustainable job with a living wage, opportunities to progress in the labour market and the ability to achieve a work life balance. Job insecurity is a major issue undermining the confidence of those wanting to work. Almost half of men who find work, and a third of women, no longer have that work six months later. This sharply illustrates the short-term nature of the jobs many unemployed people go into and not through choice; only 25% of temporary employees do not want a permanent job. [11]A TUC commissioned poll of workers (both trade union and non-trade union members) by YouGov Plc revealed that more than 3.3 million workers are not confident they will still be in a job in a year's time, adding to the growing pressure on Government policy makers to restore confidence and boost investment in UK plc. [12]
However there are groups at even greater risk of poverty including women, children, ethnic minorities, people with disabilities, young and older workers.
Women and Poverty
Although there are now almost equal numbers of men and women in work, the rise in the quantity of women's employment has not been matched by an improvement in its quality. Women predominate among the poor. Many women face a glass ceiling preventing them from reaching higher paid positions while many more have difficulty 'progressing beyond the sticky floor of part time, low paid, low status work.'[13]
There are a number of reasons to explain the gender pay gap. Gender roles and the economic status of women relative to men are heavily influenced by the way the economy operates, changes in Government policy and cuts in public spending. Women feel the effects of these changes more acutely as a greater proportion tend to be in insecure employment, on the fringes of the labour market and more dependent on benefits. This analysis is supported by the findings of the Women and Work Commission, which identified that access to learning and skills development, the way in which an employer runs an organisation, staff recruitment strategies, reward systems and career structures all have an impact on the gender pay gap. [14]
Female employees in full time work earn 17% less per hour on average than male employees; whereas females in part time work earn 38% less than the hourly rate for men in full time work. In the North East the pay gap is even more pronounced with women earning just 61.3% of male earnings. [15]Even though the overall employment rate for women is close to that of men, women are over-represented in part time and lower paid occupations. Moreover, segregation by both sector and occupation limits women's opportunity to succeed in the labour market. This pattern is also reflected in the distribution of earnings between men and women. Last year men in the region earned £440 a week compared to £350.30 for women. [16]
Many women are concentrated in poorly paid sectors, working in public administration, education and health, distribution, hotels and catering. Known as the 'the four Cs' women's employment is centred on caring, cleaning, catering and cash registers. The low value attached to this type of work is explained by the fact that these roles have traditionally been done by women on an unpaid basis at home and the skills are seen as natural rather than acquired. They are also perceived to be jobs designed to supplement a family's income, or for pin money and therefore fail to attract a living wage.
Trapped in one of the most exploited and vulnerable employment groups; 90% of home workers are women of whom 50% are from an ethnic minority group. [17]These workers are often difficult to reach, unlikely to be unionised and unaware of their rights. They are often paid well below the minimum wage, have no employment benefits such as sick pay or redundancy rights and risk losing their job if they assert their rights. This trend in women's employment is set to continue. It is predicted that by 2010 there will be more than 500,000 jobs in personal caring services, which are notoriously low paid and the majority of these will be taken on by women.[18] It is likely that many of these jobs will be taken up by migrant women who are perceived to be willing to take on low paid work arising through a lack of genuine alternatives. This will have the effect of intensifying downwards pressure on terms and conditions of employment where there is no trade union input and reinforce occupational segregation.
The primary responsibility for unpaid care still rests with women. Therefore they are unable to compete on equal terms with men in the labour market which still does not cater adequately for the needs of workers trying to balance the dual responsibilities of paid and unpaid work. Seemingly women's roles have changed. Yet even though it has become the norm for women, including mothers with dependent children, to be in paid employment and share responsibility for maintaining household income, social expectations dictate women should continue to accept primary responsibility for unpaid work in the home and men do the bulk of the breadwinning. The gender pay gap and concentration of women in so-called flexible and low paid work reinforces this idea. So how much has really changed? Behind the 'equality of participation headline' [19]there remain major differences in men and women's employment and thus their quality of life. Whilst women are increasingly taking up paid employment, men have not swapped fewer hours at work for more time in the home. Persistent differences in men and women's participation in unpaid caring and domestic tasks at home underpins gender inequalities by first, limiting the amount of time women can spend in paid work, and second by making men's employment largely unaffected by caring responsibilities.
A large proportion of British jobs are done on a part time basis by women. Motherhood is often a trigger for women working part time, whereas men tend to increase rather than decrease their working hours when they have young children. Men employed in the UK have the highest average usual working hours in Europe. However men do not have the option of well paid part time employment or the possibility of coming to a more equitable arrangement with their partner. Interestingly, two main reasons are given by employees for working extra hours: the need to generate overtime pay (46%) and a need to work unpaid overtime to deal with unmanageable workloads (34%). Such a pattern is evident in the North East labour market with 138,000 employees working more than 48 hours. The highest proportion of employees claiming they want to work fewer hours can also be found in the North East and Scotland.[20] This suggests workers are torn between the desire to work fewer hours and the economic implications of such a decision. In regions such as the North East where skills levels and wages remain low, poverty compels workers to put in longer hours. Not only does this feature of the economy carry huge costs, the negative impact of long working hours is wrought in personal, social and family relationships.
Women are paid on average less than men. If one partner is to cut back on hours or give up work it is the woman who does so. As the Women's Budget Group has acknowledged, the Government's focus on making work pay by increasing the numbers returning to work and providing subsidy in the form of tax credits has produced policies that enable a combination of paid work with unpaid caring responsibilities, such as the right to request flexible working, maternity, paternity and parental leave with the aim of facilitating women's labour market participation and tackling child poverty. Whilst these policies have undoubtedly benefitted women they have not been guided by a goal of gender equality and therefore will ultimately fail to strengthen their position in the labour market long term and provide a solution to the poverty endemic. Promoting paid work alone as a route to economic inclusion assumes policies are gender neutral, that is to say they have the same impact on men as women. What this model fails to acknowledge is that women are unable to compete with men on an equal basis in the labour market due to their caring responsibilities and the opportunity cost posed by institutional, attitudinal and cultural barriers to workplace participation. This 'gender-blind' approach could also exacerbate the risk of exclusion by valuing paid work more highly than unpaid. Put simply 'how come the people who look after our children get paid less than the people who look after our cars?'[21]
Research by the Joseph Rowntree Foundation gloomily surmises that as long as work life balance policies are focused primarily on enabling women to work, without equivalent measures to engage men and their employers, women will continue to be disadvantaged in the labour market and endure higher risks of falling or getting stuck in the poverty trap. [22]
Inflexible workplaces make participation in the labour market difficult. Many mothers want or need to work, but find they have to trade down to get the flexibility they need compounded by a lack of affordable, accessible and good quality childcare. The Women's Budget Group testify that child care for mothers who want to work is generally non-existent and unaffordable, even with tax credits. An insight into women's experience of living in poverty shows that the school day also has a major impact on when mothers can work. Consequently many women are forced into vulnerable agency work: 'I found that every week after paying gas, electric , phone bills and food shopping I was left with nothing...so I got a cash in hand job where I could bring the baby with me.'[23] This story is not uncommon reflecting the findings of the TUC's own Commission on Vulnerable Employment, which is campaigning for an end to low pay and exploitation. [24]
Women continue to be disadvantaged by a gender gap on every single measure of economic welfare from employment, pay, income, pensions and assets. Without comparable economic status to men, women are placed at a higher risk of poverty, dependency on the state and reliance on their partners.
In the Iron Triangle, the TUC demonstrates the interaction between low pay, women's and children's poverty. The briefing echoes the conclusions of the Fawcett Society Keeping Mum campaign that women's inequality and child poverty cannot afford to be treated in isolation. Low pay is identified as a significant cause of women's poverty, which is not only relevant to women themselves, but also has pernicious effects on children. As the Fawcett Society highlights, from the moment they conceive a child, women face immediate financial penalties - thousands lose their jobs, and many more face disadvantage and reduced opportunities in the workplace. After having a child, many Mums are forced to undertake part-time, low paid, low status work. Perhaps the worst aspect of child poverty is that a clear majority of children in poverty live in a family where one or more adults have jobs. Altogether, 57% of all poor children live in families where one or more adults are in work.
The North East is one of two regions in the UK where the prevalence of child poverty exceeds 30%. Although the proportion of children living in poverty has fallen in the North East over the past five years, the gap with the rest of the country has yet to close. The proportion of children estimated to be living in households suffering from income poverty is second only to London with nearly a third of children falling beneath the official threshold. The Index of Deprivation shows that over a quarter of children in the region live in income deprived households, the worst rates outside of London. There are widespread pockets of deprivation affecting children within inner city areas of Tyne and Wear, Tees Valley and Middlesbrough, and in the former mining communities of Northumberland and Durham. About one in three children in the North East are living in poverty and grow up to live in poverty as adults.
Education and Training
Some workers face particular barriers to improve their skills and gain secure employment. Evidence shows a major change in employer behaviour is required to overcome the training divide and poses a huge challenge for the success of the Leitch Skills Pledge, which sends a clear message to employers of the imperative to train every worker if the UK is to thrive in a global economy. Analysis by the New Policy Institute (MacInnes and Kenway 2007) showed that, as a large proportion of the workforce in 2020 are in work now it is critical employers invest in training for those who are low skilled. A report by the TUC (2007) shows that currently around 35% of employers, covering 25% of the workforce offer no in work training at all. [25]Therefore it is disappointing that access to employer provided and work related training is also significantly gender differentiated. Although women are likely to receive slightly more on the job training than men, it is less likely to be of the type that leads to a formal qualification, which in turn helps to facilitate career progression. Training also tends to be focused on the individual rather than the job. Consequently even if women have the skills to meet the demands of the job, the nature of the occupation itself and working environment may be unsupportive. As a result women encounter discrimination and experience difficulties balancing work and family life.
Educational attainment is also a strong determinant of employment experience. Many subject areas remain dominated by either women or men, both at school, in further education and vocational training. This division continues to contribute to occupational segregation between men and women, which in turn feeds the gender pay gap. While more apprenticeship places have opened up for women in general, this has not happened in better paid male dominated sectors such as engineering and construction. Apprenticeships are still strongly divided along gender lines. In the North East only 1.3% of female apprentices work in vehicle maintenance and repair and in construction the figure drops to 0.8%. In the same period 96.9% of apprentices in childcare were female and 94% of hairdressing apprentices were women, the two lowest paying sectors.[26] While the Government's commitment to increase the number of apprenticeships as a good route into work for young people is welcome, the TUC would draw attention to the fact that some apprentices receive low pay and inadequate training. Some apprentices are being paid as little as £1.54 an hour, with low pay particularly affecting female apprentices, who on average are paid 26% less than their male counterparts. [27]Most apprentices are exempt from the minimum wage, but in 2005 the LSC established a minimum payment of £80 a week for apprentices. The TUC believes that while this rate has helped to protect some apprentices from unscrupulous employment practices, a pay rise is long overdue. The TUC would like to see the minimum rate for apprentices to be increased to £110 a week, which would be roughly in line with the minimum wage youth rate (£3.40 an hour). According to recent statistics on apprentice pay, less than one in ten are paid between the LSC minimum rate of £80 and the TUC proposed rate of £110. TUC calculations show that increasing the minimum rate to £110 would be relatively inexpensive and only represent a fraction of employers' payroll expenditure to keep young people out of poverty. [28]
Younger workers are far more likely to be low paid than older workers. In 2006 people aged under 22 were far more likely to be low paid than those aged between 22 and 29. Those in their thirties and forties were even less likely to be low paid, although the incidence of low pay begins to rise again once people are over 50. Nearly seven in ten 18 to 21 year olds were low paid in 2006, equating to more than one in five (20.4%) of all low paid workers. Those households headed by younger people are at a far greater risk of working poverty, disadvantaged by low youth rates of the minimum wage and because working tax credits are not available to childless people under the age of 25. [29]
Poverty and Disability
The poverty rate for disabled people of working age is significantly higher than those who are not disabled. In 2006 the risk of being in working poverty was higher for those households with a disabled adult (18%) than for those without (14%). Overall, a quarter of all working-age households have at least one adult with a disability, and 30% of those households are poor compared to 20% with no disabled adult. Analysis of the Labour Force Survey for the Poverty Site, the New Policy Institute's website for statistics on poverty and social exclusion in the UK, finds that the proportion of employees with a work-limiting disability who earned less than £6.50 in April 2007 was around 10% higher than for those without such a condition. This was true of full and part time workers across a range of skill levels.
Disability and ill health are major factors contributing to economic exclusion in the North East as the region has a markedly higher proportion of working aged people who are disabled, nearly 24% compared to 18.4% for England. [30]Many people with disabilities face multiple barriers to full participation in the workplace and are subject to discrimination. It is vital employers are encouraged to introduce reasonable adjustments and develop supportive working environments to make work possible and rewarding for people with disabilities. Due to greater numbers of people suffering from a disability or ill health there are higher numbers of carers in the North East, who also suffer poverty and deprivation. In part this is because of limited access to highly paid jobs, which are incompatible with caring responsibilities outside work.
Ethnic Minorities
People living in ethnic minority households face around twice the risk of working poverty as households headed by a white person. The differences are particularly stark for families where at least one adult is in paid work: around 60% of Bangladeshis, 40% of Pakistanis and 30% of Black Africans are in low income households, much higher than the 10 to 15% for White British, White Other, Indians and Black Caribbeans.
Indeed half of Bangladeshis and Pakistanis earn less than £7 an hour. [31]
Beyond the scope of these figures The Poverty Site notes that data in respect of ethnic minorities is both complex and limited; therefore it is difficult to conduct a comprehensive analysis of the relationship between low pay and income poverty for these groups.
Nonetheless a report for the TUC; Ten Years After,[32] takes a retrospective look at black workers employment in the last decade finding that whilst the proportion of ethnic minorities in work had increased slightly, the majority are disproportionately employed in low paying sectors including public services, distribution, hotels, restaurants, banking, finance and insurance. Once in employment BME workers are unable to progress in the labour market. The report indicates that whilst employment levels have increased across industry, there are still many areas of employment, especially in the private sector, where black and minority ethnic workers are poorly represented.
The TUC is also troubled by an apparent lack of employer engagement with strategies to eradicate race discrimination in the workplace. The National Employment Panel identified that 42% of private employers could not articulate reasons to promote race equality and 83% did not believe their employment practices would be investigated. The report resolutely confirms employers need to do far more to tackle the institutional racism that is resulting in the low levels of employment of black and minority ethnic workers from some industrial sectors.
While supporting the Government's efforts to facilitate pathways into employment as a way of tackling poverty, the TUC maintains it is imperative people are employed in quality jobs with decent pay, access to training and opportunities for advancement. Employment in low skilled poorly paid jobs only succeeds in replacing 'out of work poverty' with 'in work poverty'.
Refugees and Asylum Seekers
A significant number of people are rendered invisible because of their immigration status and it can take up to three years or more for their Home Office application to be processed. Asylum seekers and refugees are prohibited from working or collecting benefits. These men and women have fled persecution in their own countries. While they are here in the UK they want to work, support themselves, pay taxes and contribute to the economy, but are banned from working. The Women's Budget Group document illicit practices in the so-called grey economy, in which women asylum seekers and refugees are coerced into working long hours for cash, below the minimum wage and paying tax for which they can never claim the benefit in retirement. Language barriers deepen exclusion and make bureaucracy more difficult to negotiate. As a result most options for women needing to support their families are criminalised, for instance begging or prostitution. As one participant in the study of Women's and Children's Poverty commented: 'It is a great injustice that women and children have to live like this in a country with so much wealth.'[33] This is why the TUC has joined forces with the Refugee Council to campaign for the right to work, especially for the most vulnerable groups living in the UK today.[34]
Poverty and Ill Health
Poor men face particular health risks, including heart disease, testicular cancer, alcohol abuse, suicide and high overall mortality, compounded by a greater reluctance to use professional health services. Young men living in areas of high unemployment and deprivation are more vulnerable to and likely to commit violent crime, including football hooliganism, alcohol-related violence, racist and homophobic attacks.
Women in poverty often describe experiencing stigma, and are bereft of opportunities which leads to feelings of stress, guilt, shame, lack of control and widespread depression, ultimately damaging their physical health and mental well being.
A study of parents in deprived environments found that they were three times as likely as other adults in the general population to suffer from emotional and mental health problems (Ghate & Hazel 2004). [35]Utting observes that 'parents in poor environments (characterised by low income, deprived neighbourhoods and bad housing) do not see themselves as having problems with parenting as much as having problems with poverty.' [36]Vergeris and Perry expose the link between insecure employment, low income and poor health; a vicious circle which yields few resources to lead a healthy lifestyle.[37]
Children are the labour force of the future and children who grow up in poverty will be less productive workers. They will be prone to poor health, which means their working lives will be shorter and they will have more and longer absences during their economically active years. They will also tend to have fewer skills and qualification, rendered less able to maximise their potential, leave the workforce early and face poverty from their middle age. The TUC estimates that the costs of child poverty to the UK from reduced productivity and economic output are £13 billion a year. In Cutting the Costs of Child Poverty, the TUC notes this is a problem that is getting worse: people who were poor teenagers in the 1980s were twice as likely to be poor thirty somethings as people who were poor teenagers in the 1970s. [38]
The World Health Organisation (WHO) carried out a three year analysis of the 'social determinants' of health concluding that 'social injustice is killing people on a grand scale' and in almost all countries poor socioeconomic circumstances equated to poor health. The report recommended that governments should take action to ensure a living wage for workers and conditions that reduce work-related stress and ensure a healthy work-life balance. Sir Michael Marmot, chairman of the commission when interviewed by the BBC Radio 4's Today programme said "The key message of our report is that the circumstances in which people are born, grow, live, work, and age are the fundamental drivers of health, and health inequity.
We rely too much on medical interventions as a way of increasing life expectancy. People need the opportunity, the possibility, to take control of their lives - but the conditions need to be right to allow them to do that." [39]
In light of this influential report it not unreasonable to conclude that persistent health inequalities are more pronounced in the North East where low pay is prevalent and there is a higher incidence of poverty. Narrowing health disparities requires innovation. The TUC would urge policy makers to look beyond the constraints of medical intervention and public health spending to tackle the root causes of this major challenge for the region. Enhancing the quality of working life offers significant potential to lift people out of poverty, increase productivity and improve health so that the region is resilient in its response to future economic and social change.
Conclusions and Recommendations
Trade unionists will be unsurprised to learn that it pays to be a member of a trade union. Trade union members consistently earn more than non-members. Among those earning less than £6.50 an hour, just one in eight of both men and women belong to a trade union. [40]Trade unions possess considerable leverage to influence the extent of low pay and share a responsibility to improve the lives of all workers. In doing so it is important to recognise that this objective cannot be achieved by campaigning for changes to the law alone.
Following a decade of uninterrupted growth Britain is once more on the verge of a recession and to a degree at the mercy of global economic forces, not all of which fall within our control. Nevertheless trade unions remain determined that poverty should not be regarded as an inexorable consequence of a faltering economy dented by loss of consumer confidence, nor should it be accepted that when the good times roll there will always be some who fall and get left behind. Social commentators such as The New Policy Institute and Joseph Rowntree Foundation insist that the current strategy for tackling poverty and social exclusion is now exhausted and 'doing nothing new' doesn't any longer equate to slow and steady progress; instead it means that nothing changes. Although the Government has introduced several welcome measures, they are no longer commensurate with the scale of the challenge before us. [41]This is because until now the priority has been to get greater numbers of people into work and improve productivity. To a certain extent we can claim to 'have reached our destination', but in doing so have neglected to tackle working poverty. In spite of this, the fight against poverty should not succumb to the mood of pessimism that has descended in recent months. Conversely it can be seen as an opportunity for renewal and one which holds considerable scope for trade unions to ensure there is an anti-poverty strategy that better serves the interests of low paid working people. The next road travelled needs to be rooted firmly in a workplace agenda that is capable of engaging employers, the workforce, Government and public agencies.
Although policy and legislative reform can go some way towards tackling inequality, we should acknowledge there are limits on the Government's ability to regulate employer wage-setting practices and public reluctance for higher taxes to fund redistribution to the poor. As the Fawcett Society points out, Government anti-poverty strategies can easily be reversed or wiped out by subsequent administrations, thus any ground gained can be easily lost. This is not an admission of weakness or abdication of responsibility. Rather, in exercising this strategic judgement, the trade union movement is better positioned to consider more sustainable options that are capable of winning widespread public support and therefore less likely to be overturned. In this way trade unions can succeed in embedding policies beneficial to working people. The Minimum Wage is a good example of this.
There is no doubt that lobbying will still feature prominently in advocating for an anti-poverty strategy that firstly acknowledges working people also experience economic and social exclusion and secondly responds to their concerns appropriately. But to be truly effective in the fight against poverty partners need to come together and draw on shared resources, effectively enforcing rights already won and in parallel making the most of opportunities available to us. True progress and groundbreaking solutions often come about by strong leadership and setting an example others can follow.
It is in this context that the conclusions and recommendations for action outlined in this report are intended to be considered.
Setting an Example in the Public Sector
Government could take the lead in addressing low pay as a major employer in its own right. An anti-poverty strategy could inform public procurement policies which govern the £125 billion spent each year on contracting goods and services. Requirements to train the workforce and pay a living wage would underpin sustainable economic development by reducing dependence on tax credits to supplement low pay.
Regional Governance
In a review of place-based regeneration initiatives the Joseph Rowntree Foundation argued that fragmented policy and governance arrangements in relation to social inclusion and economic development constituted key barriers to the delivery of more effective interventions to turn around the fortunes of deprived areas. [42]Debates about whether to focus on people or place were deemed to have imposed a false divide. Enabling those experiencing poverty and disadvantage to enjoy greater inclusion requires co-ordination across all tiers of governance and an integrated approach towards tackling economic, social and environmental issues. Poor links between the regional economic agenda and social inclusion programmes at local level are considered responsible for producing mixed outcomes. In taking forward the recommendations of the Sub National Review, the TUC would stress that the answer lies not in replicating the RDA's responsibilities at local level, or imposing social responsibilities where they do not fit, rather it is about identifying those issues where it makes sense to invoke a partnership approach. Arguably addressing working poverty provides a strong rationale for tackling social and economic issues holistically and would enable the region to align influence and resources more closely to its own defined set of priorities.
Equal Work of Equal Value
Further effort is needed to tackle the low value attached to work currently done by women. Addressing occupational segregation by encouraging women into higher paying sectors dominated by men will have limited impact unless there are similar attempts to move men into traditional women's occupations, which in order to attract them will need to be better paid. Men and women are socially conditioned into gender roles from a young age. Therefore targeting young people's career choices can help to influence this trend, but this must be in conjunction with obtaining higher rates of pay for the incumbent women's workforce. There a number of mechanisms available to achieve this aim, one of which would be for trade union representatives to call on employers to conduct and act on pay audits in both the public and private sector.
Flexible Working
The current divide in Britain between very long full time hours and relatively short part time hours is acting as a drag on productivity and damaging to the health of the workforce. If the option to work longer part time hours was opened up, in well paid jobs with opportunities for progression it would no longer be viewed as the poor relative of full time employment and have such a negative impact on working people's economic position. A life course approach to working time would acknowledge and thereby make it possible to predict with more certainty, the impact of different life course events on participation in the labour market, thus the demand for flexible working. This perspective entails a shift away from a focus on separate life events to one where they are seen to be connected and take into account the need to reduce or increase working hours to accommodate lifelong learning, career breaks and caring. Applying a life course approach would help to produce a more systematic and integrated policy framework for the promotion of flexible working. Extending the right to request flexible working to the whole working population would help to promote the practice more widely so that it comes to be regarded as a standard way of working. In the workplace trade union representatives can collectively negotiate flexible working agreements with employers to ensure this right is implemented fairly and effectively across the workforce. Unions and employers need to make flexible working a central focus of pay and collective bargaining issues with a view to eliminating inducements to long hours working and evaluate the gender equality impact of pay structures associated with different working practices.
To realise this objective the quid pro quo would mean demonstrating to employers this model can deliver productivity benefits. The TUC has a wealth of resources to assist trade union representatives make the case for flexible working to their employer and develop a work life balance policy suitable for their workplace.
Accessible, Affordable, Good Quality Childcare
Traditionally Governments have been reluctant to interfere in the private sphere of the family and this may help to explain why relatively little public money has been spent on creating an adequate system of childcare since huge numbers of women have swapped the home for employment. There is an urgent need for a recognised system of childcare provision to support people working outside school hours and at weekends. Governments have tended to rely on market led solutions to care that is contributing to a scarce supply and serious issues of affordability. A cross-party solution capable of keeping pace with trends in modern living and withstanding political change is required. Perhaps one option would be for RDAs to target enterprise activity towards establishing a recognised system of childcare providers for working parents. In the mean time trade union representatives will continue campaigning and bargaining for improved terms and conditions for the social care workforce, a key contributor to the success of the regional economy.
Increased Investment in Education and Training
Union led learning and Government policy is credited with substantially narrowing the training divide. Building on this success will be vital in the months and years ahead. Workplace learning is rightly seen as an essential bargaining chip in 21st century employment negotiations, equipping people with the skills and knowledge they need to fulfil their potential in the future economy. However it should not be viewed as a mechanism replacing pay talks, rather more like a complementary bargaining tool. Successful interventions by Union Learning Reps and pro-active policies developed by Government suggest that it is not poverty of learning opportunities that is contributing to low paid, low skilled work and a less productive economy, but outdated employer attitudes and difficulty securing paid time off to train that is preventing workers from capitalising on these resources to progress within the labour market. The Leitch Skills Pledge and Right to Request Time Off to Train present trade unions with an unrivalled opportunity to ensure forthcoming legislation is framed in such a way so as to enable every worker acquire skills to distance themselves from the threat of poverty. ULRs should also continue contributing to workplace organising strategies by negotiating learning agreements with employers, conducting learning needs assessments, establishing education programmes and cultivating an environment in which everybody can develop new skills.
Promoting Equality and Diversity
Poverty and inequality are indivisible, locking low paid vulnerable workers into a vicious cycle of being unable to participate in workplace activities and access the same opportunities as colleagues. The development and implementation of good equality and diversity policies and practices is an essential part of helping people to overcome barriers that result in marginalisation at work and in the community. Trade union representatives have a crucial role to play in pro-actively increasing the number of workplaces promoting equality of opportunity and respect for diversity by generating a broader understanding of how to identify and meet the needs of different social groups so that it becomes a part of every day work for an organisation and its staff. A good example of this in practice would be to demonstrate that poverty affects diverse groups of people, who should not be singled out or treated as a homogenous mass. A single person is five times at risk of poverty than somebody who lives in a family household; however when discussing poverty there is a tendency to refer to certain groups such as families or children. Similarly a trade union representative may be called upon to ensure employers are complying with their responsibilities under the Disability Discrimination Act by making reasonable adjustments that would enable a colleague to work.
Health and Well Being
Poor health and poverty are inextricably linked. They are factors which impede people's productivity, performance and attendance at work. Low paid, low skilled workplaces contribute to the spread of poverty and ill health by perpetuating the circumstances in which these conditions thrive. In workplaces where this is the case trade union representatives can raise awareness of these issues with employers and take measures to help mitigate the negative effects of poverty by: building the capacity of health and safety representatives to challenge bad practice; negotiate improved terms and conditions; engage employers in providing appropriate occupational health support and encourage workers at risk to lead healthy lifestyles by promoting solutions to poverty- related health conditions such as obesity, smoking, drug and alcohol abuse, all of which have a negative impact on the productivity and longevity of people's working lives.
Campaign!
Low pay, poverty, inequality and exploitation are all causes that stir trade unionists. Form an alliance and join the campaign for the right to dignity at work:
The TUC supports the Fawcett Society's Keeping Mum Campaign to tackle mother's poverty. Visit http://www.fawcettsociety.org.uk/index.asp?PageID=644 and send an e postcard to Gordon Brown and download your free campaign newsletter.
Lend your weight to End Child Poverty and hold Government to its promise to halve the number of children in poverty by 2010 and end child poverty by 2020. Show this issue matters to you by lobbying your MP. Further information is available at http://www.endchildpoverty.org.uk/promise
Sign up to the Just Fair Campaign calling for asylum seekers to be allowed to work.
Get involved in Opposing the Far Right by joining your local anti-racist coalition working to promote community cohesion where poverty and inequality cause division.
References
Background Briefing for the Keeping Mum Campaign, Fawcett Society (2008) http://www.fawcettsociety.org.uk/index.asp?PageID=647
Bell K, Brewer M & Phillips D Lone parents and 'mini-jobs' (2007) Joseph Rowntree Foundation
Bellamy, K & Rake K (2005) Money Money Money Is it Still a Rich Man's World? An audit of women's economic welfare in Britain today Fawcett
Coates, A and Bolam D (2006) Child Poverty: Brief Analysis of Data Relating to the North East, Government Office for the North East
Cooke G, Lawton K (2008) Working out of poverty: A study of the low paid 'working poor' Institute of Public Policy Research (IPPR)
Cutting the Costs of Child Poverty (2007) TUC
Ending Child Poverty: A Northern TUC Report on Child Poverty (2007)
Ghate D & Hazel N (2004) Parenting in Poor Environments, London: Jessica Kingsley
Guide to Flexible Working, Northern TUC (2007)
Knight J: The Changing Face of Poverty, 26 July 2005, BBC News Channel. Available at: http://news.bbc.co.uk/1/hi/business/4070112.stm
Let Them Work Campaign. Further details available at http://www.refugeecouncil.org.uk/gettinginvolved/campaign/righttowork/ 28 August 2008
More than three million workers not confident that they will be in their job in a year's time. 28 August 2008, TUC. Detailed results available at http://tuc.org.uk/extras/TUCjobsecuritypoll.pdf
North East ESF Framework 2007-13 Final Version July 2007
Palmer, G , MacInnes, T & Kenway P(2007) Monitoring poverty and Social Exclusion 2007 New Policy Institute
Patterns of Pay: results of the Annual Survey of Hours and Earnings 1997-2007 (ONS )
Poverty and inequality and children (2008) TUC
Rowan K: Why make poorest pay? The Journal, 14 July 2008, available at http://www.nebusiness.co.uk/business-news/latest-business-news/tm_headline=why
Social factors key to ill health, 28 August 2008, BBC News Channel. Available at: http://news.bbc.co.uk/1/hi/health/7584056.stm
Speak Up For Public Services: Six Million Pay Cuts TUC (2007)
Taylor M (July 2008) Transforming disadvantaged places: effective strategies for places and people. Joseph Rowntree Foundation
Ten Years After; Black Workers in Employment 1997-2007 (2008) TUC
The Poverty Site: Insecure at work, available at http://www.poverty.org.uk/33/index.shmtl?7
The Poverty Site: Key Facts, available at: http://www.poverty.org.uk/summary/key%20facts.shtml
The Poverty Site: Low pay by ethnicity, available at: http://www.poverty.org.uk/31c/index.shtml?2
The Poverty Site: Numbers in Low Pay, available at: http://www.poverty.org.uk/30/index.shtml?2
The Iron Triangle: women's poverty, children's poverty and in-work poverty (2008) TUC
TUC Commission on Vulnerable Employment: Hard Work, Hidden Lives (2008) Available at: http://www.vulnerableworkers.org.uk/cove-report/short-report/
TUC Still more (better paid) jobs for the boys: apprenticeships and gender segregation (2008)
TUC Apprenticeships: Skilling the Regions. The regional distribution of apprenticeships in England (2008)
TUCDecent pay for apprentices: Updating and extending the Learning and Skills Council's minimum rate and reviewing the National Minimum Wage Exemptions. (2008)
Utting D (1995) Family and Parenthood. Supporting Families, Preventing Breakdown, York: Joseph Rowntree Foundation
Vegeris S & Perry J (2003) Families and Children 2001: Living Standards and the Children, DWP Research Report No 190, Leeds Corporate Document Services
Women's Budget Group (2008) Women and poverty: Experiences, empowerment and engagement. Joseph Rowntree Foundation
Women's Budget Group (2005) Women's and children's poverty: making the links. WBG C/O Fawcett Society
Women and Work Commission, Shaping a Fairer Future, Executive Summary (2006)
Women and Work: A Briefing for the Northern TUC (2008)
[1] Knight J: The Changing Face of Poverty, 26 July 2005, BBC News Channel. Available at: http://news.bbc.co.uk/1/hi/business/4070112.stm
[2] Poverty and inequality and children (2008) TUC
[3] Cooke G, Lawton K (2008) Working out of poverty: A study of the low paid 'working poor' Institute of Public Policy Research (IPPR)
[4] Patterns of Pay: results of the Annual Survey of Hours and Earnings 1997-2007 (ONS )
[5] Speak Up For Public Services: Six Million Pay Cuts TUC (2007)
[6] Palmer, G , MacInnes, T & Kenway P(2007) Monitoring poverty and Social Exclusion 2007 New Policy Institute
[7] Cooke G, Lawton K (2008) Working out of poverty: A study of the low paid 'working poor' Institute of Public Policy Research (IPPR) p7
[8] Women's Budget Group (2005) Women's and children's poverty: making the links. WBG C/O Fawcett Society (1996, cited in Rake, 2000: 145)
[9] Patterns of Pay: results of the Annual Survey of Hours and Earnings 1997-2007 (ONS )
[10] Rowan K: Why make poorest pay? The Journal, 14 July 2008, available at http://www.nebusiness.co.uk/business-news/latest-business-news/tm_headline=why
[11] The Poverty Site: Insecure at work, available at http://www.poverty.org.uk/33/index.shmtl?7
[12] More than three million workers not confident that they will be in their job in a year's time. 28 August 2008, TUC. Detailed results available at http://tuc.org.uk/extras/TUCjobsecuritypoll.pdf
[13] Bellamy, K & Rake K (2005) Money Money Money Is it Still a Rich Man's World? An audit of women's economic welfare in Britain today Fawcett p19
[14] Women and Work Commission, Shaping a Fairer Future, Executive Summary (2006)
[15] North East ESF Framework 2007-13 Final Version July 2007 p19
[16] Guide to Flexible Working, Northern TUC (2007)
[17] Oxfam (2004)
[18] Bellamy, K & Rake K (2005) Money Money Money Is it Still a Rich Man's World? An audit of women's economic welfare in Britain today Fawcett cited in Dickens et al (2003)
[19] Bellamy, K & Rake K (2005) Money Money Money Is it Still a Rich Man's World? An audit of women's economic welfare in Britain today Fawcett
[20] Guide to Flexible Working, Northern TUC (2007)
[21] http://www.fawcettsociety.org.uk/index.asp?PageID=464
[22] Women's Budget Group (2008) Women and poverty: Experiences, empowerment and engagement. Joseph Rowntree Foundation
[23] Women's Budget Group (2005) Women's and children's poverty: making the links. WBG C/O Fawcett Society p 20
[24] TUC Commission on Vulnerable Employment: Hard Work, Hidden Lives (2008) Available at: http://www.vulnerableworkers.org.uk/cove-report/short-report/
[25] Time to Tackle the Training Divide TUC, OSD August 2007
[26] TUC Apprenticeships: Skilling the Regions. The regional distribution of apprenticeships in England (2008)
[27] TUC Still more (better paid) jobs for the boys: apprenticeships and gender segregation (2008)
[28] TUCDecent pay for apprentices: Updating and extending the Learning and Skills Council's minimum rate and reviewing the National Minimum Wage Exemptions. (2008)
[29] Cooke G, Lawton K (2008) Working out of poverty: A study of the low paid 'working poor' Institute of Public Policy Research (IPPR) p23
[30] North East ESF Framework 2007-13 Final Version July 2007 p20
[31] The Poverty Site: Low pay by ethnicity, available at: http://www.poverty.org.uk/31c/index.shtml?2
[32] Ten Years After; Black Workers in Employment 1997-2007 (2008) TUC
[33] Women's Budget Group (2005) Women's and children's poverty: making the links. WBG C/O Fawcett Society p 22
[34] Let Them Work Campaign. Further details available at http://www.refugeecouncil.org.uk/gettinginvolved/campaign/righttowork/ 28 August 2008
[35] Ghate D & Hazel N (2004) Parenting in Poor Environments, London: Jessica Kingsley
[36] Utting D (1995) Family and Parenthood. Supporting Families, Preventing Breakdown, York: Joseph Rowntree Foundation
[37] Vegeris S & Perry J (2003) Families and Children 2001: Living Standards and the Children, DWP Research Report No 190, Leeds Corporate Document Services
[38] Cutting the Costs of Child Poverty (2007) TUC
[39] Social factors key to ill health, 28 August 2008, BBC News Channel. Available at: http://news.bbc.co.uk/1/hi/health/7584056.stm
[40] Palmer, G , MacInnes, T & Kenway P(2007) Monitoring poverty and Social Exclusion 2007 New Policy Institute p 78
[41] Palmer, G , MacInnes, T & Kenway P(2007) Monitoring poverty and Social Exclusion 2007 New Policy Institute p9
[42] Taylor M (July 2008) Transforming disadvantaged places: effective strategies for places and people. Joseph Rowntree Foundation
Trade Unions Tackling Poverty |
Carolyn Clayton |
Briefing document (9,400 words) issued 3 Sep 2008
