Our reporter Odira Ndulue interviewed Julia Unwin of the Joseph Rowntree Foundation.
You recently said many employers have abandoned their responsibilities to their staff and presided over the creation of the most insecure employment model in the developed world, what do you mean by that?
Employers have a responsibility to their staff. Where they can afford to, they should pay the Living Wage, offer permanent contracts, and training to ensure that work pays.
Our research has shown that an insecure jobs market traps people in poverty. We are clear that moving in and out of insecure, short-term and poorly paid jobs is no route out of poverty. This is one of the reasons that we have more people poverty in households where someone works than in out of work households. If work is not a guaranteed route out of poverty then what is?
There seems some confusion between the Minimum Wage and the Living Wage. Which is the most important metric?
There is no confusion. The minimum wage is set by the Low Pay Commission, which is a representative body including members from business, unions, academia and other interest groups. They rate is set through negotiation by the group, on the basis of independent research that they commission and is submitted to them by the Government. The fundamental principle determining the level of NMW is what the LPC think the labour market can bear each year, given the wider economic context. It does not take into account what people actually need to earn to ensure they can afford an acceptable standard of living or avoid poverty.
In contrast, the Living Wage is based on calculations rooted in the changing costs of living for working families, which are affected by changing prices and changes to the tax and benefits system. The London Living Wage is set by the GLA and across the rest of the UK by the Living Wage Foundation, based on research funded by JRF about what the public think is the minimum acceptable standard of living in the UK today.
Both are important, and we have come a long way since there was no NMW, but if we are to end in work poverty, we need more employers to pay the Living Wage, maintain pressure on the LPC to keep raising the NMW as fast as possible and to address the other aspects of the UK labour market – such as lack of progression and high levels of insecurity – that affect poverty.
What affect has the recent flooding had on deprived communities?
Flooding has a devastating effect on any community. However, those who are already disadvantaged, who lack insurance, social networks or resources, will be among those hardest hit.
Will climate change bring more hardships?
We know that we are going to have to adapt as we experience more extreme weather. We have mapped out the areas of the country that are most flood and heat disadvantaged. And this is not just about resources, this is about health and society too – older people have died in heat waves because they are too afraid to have their windows open or are isolated and lack social networks to support them. The built environment also makes a difference – people in basement flats will be more affected by flooding than those in high rise flats but the opposite may be true for heat. We need to look at this problem much more holistically.
Adaptation means considering people’s ability to prepare for, respond to and recover from extreme weather. We need to do more to build longer term resilience considering the personal social and environmental context in which communities live.
The future arrangements for flood insurance will also be critical to ensure that insurance remains affordable in high risk areas. JRF supports the Flood Re approach put forward in the Water Bill which will mean a small amount of insurance premiums from all households are pooled and used to support those at highest risk to access affordable rates. We are concerned about exclusions of some groups including those in homes built since 2009 and small businesses. There is also a longer term move to risk-reflective market pricing over 25 years which may leave insurance unaffordable to some households unless flood resilience is improved in the interim.
The Flux Report predicted that within five years the majority of people will work more flexibly for multiple clients. Do you think that income diversification can become an alternative route out of poverty or will this shift bypass the less educated?
There are currently 1.4 million people working part time but wanting to work full time. Despite a small fall recently, this is still at a historically high level, so I imagine more people will work for more than one employer in future. Whether this is out of choice or necessity is tough to say. Working part time when you need to work full time makes it difficult to make ends meet.
With the introduction of Universal Credit, increasing self-employment and making working in ‘mini-jobs’ (<16 hours a week) more rewarding, we could see an increase in such trends. We need to balance flexibility for employees with flexibility for employers. Most trends in the labour market show emphasis on the latter rather than the former for workers who are in poverty. Working for multiple clients can be rewarding, and bring variety and interest. It can also be deeply insecure, and represent a 21st Century version of casualisation, that too frequently leads to penury.
Many industries are complaining about a skills gap, particularly manufacturing. Do you think that ‘a factory job’ holds less appeal nowadays?
There are certainly fewer jobs where you can work your way up from the factory floor these days. Employers need to invest in training to improve the skills their workers have, so that these jobs really are viable routes out of poverty. The alternative is a labour market with only low skilled and high skilled jobs and very few ways to climb the ladder between the two.
Do you think that the value of an apprenticeship is promoted widely enough in school career guidance?
It is a long time since I have been close enough to a school career guidance service for me to comment with any authority on this. What is important is to recognize that traditional learning routes do not suit all students, and that higher education isn’t the right option for everyone. Education, training and careers are a marathon, not a sprint and as we all face longer working lives, we need to recognize the many phases of a working life. In my experience the best and most creative ‘career paths’ are those that inhabit different sectors, and different occupational groups. Some of the most successful people I know have moved from front line operational work, to policy and strategy and back again. Good apprenticeships bring the opportunity to learn real, transferable skills, and gain genuine work experience, while earning a wage. JRF is committed to apprenticeships and we currently have 7 placements across JRF and JRHT. We always have a business apprentice in my Chief Executive’s office and the organisation is much richer for the skills and knowledge these people bring.
What affect do you think immigration has had on deprived areas? Has this filled otherwise vacant jobs or taken jobs away from local people?
The economy of this country has been built by migrants and all thriving economies have diverse skills. There is no doubt that in some parts of the country, through this very deep recession, some people have felt displaced but I have seen little compelling evidence that this is what has really happened. Instead there are some very poor labour market practices, both in forced labour and in other forms of highly casual work, which have been done by people who are recent immigrants.
As a female leader yourself, do you think that quotas for women are a good thing?
It disappoints me that we are still having to consider setting quotas for women. In an age where more than half of all graduates are women, this should be something that happens naturally. At JRF/JRHT just under half of our directors are female, we did not have to set quotas to achieve this, we just chose the best people for the jobs. But there is undoubtedly still discrimination in the labour market against women. There is also discrimination on the grounds of sexuality, disability, ethnicity, faith and age. The notion that such discrimination prevents us from attracting the very best people appalls me. It is a loss to the economy, damaging to individual businesses as well as deeply unjust. In some areas we may need to consider quotas just to ensure that we do encourage the very best talent, but it would be far better to use intelligent and creative processes to attract, and keep talent.