‘Jobs boom has benefited lower paid’

The last 10 years have seen a jobs boom amid a pay freeze, with many young people being employed in insecure work, says a new Resolution Foundation report.

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Britain’s post-crisis jobs boom has particularly benefited low-income households and disadvantaged groups – though rising employment has been accompanied by higher job insecurity for young people in particular – according to a new report published by the Resolution Foundation.

Setting the record straight finds that lower-income and disadvantaged groups have been the main beneficiaries of Britain’s recent job boom. Almost two-thirds of the jobs growth since 2008 has gone to people in the bottom half of the income distribution, with employment growth even more progressive for those under the age of 50. People with low qualifications account for almost half of the jobs growth, while people with a disability account for a third of the rise, says the Foundation.

The report also finds that the employment surge has not been as London-centric as some claim. Traditionally low employment urban areas across the UK are performing well, with the largest improvements since 2008 in South Yorkshire and Merseyside. However, while overall geographic ‘employment inequality’ is falling, the Foundation warns that some areas outside the UK’s big cities have seen less benefit, for instance, employment fell across the rest of Yorkshire and Humberside, and increased by just 2.2 percentage points across the rest of the North West.

The report also says Britain’s jobs boom has not been driven by low-wage jobs. Half of all jobs growth since 2008 has taken place in professional occupations, business services and real estate jobs, all of which are relatively high-paid. An ageing society has also led to strong growth in the health and social care sectors. In contrast, the share of jobs in finance and retail has declined over the last decade. However, the report warns that young people haven’t fully benefitted from the growth of higher-paying occupations. The share of 18-29 year olds in lower-paying job roles has expanded over the last decade, while it has fallen for the rest of the workforce.

Rising employment over the last decade has been accompanied by higher job insecurity, says the report. Britain’s initial post-crisis jobs growth saw an increase in atypical – and sometimes insecure – roles such as self-employment, zero-hours contracts and agency work. This growth has been particularly acute for 18 to 29 year olds, where it has risen 50 per cent faster than for the rest of the population, states the report. Over the past year, however, the entirety of jobs growth has been in full-time employee roles. Nevertheless, says the report, Britain has 780,000 people on zero-hour contracts, 950,000 agency workers and one in seven workers are now self-employed – all significantly above pre-crisis levels.

The Foundation says policy makers should focus on issues such as job security and pay.

Stephen Clarke, Senior Economic Analyst at the Resolution Foundation, said: “While the jobs surge has not been as dominated by London or low paid work as some claim, new challenges have developed – particularly for younger workers and with a big rise in insecure work. And while more people are working, as a country we are still earning less each week for doing so than we were 10 years ago.”



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