Tag Archives: Labour Force Survey

A high-skill, low-wage recovery – Flip Chart Fairy Tales

Here are a few facts to remember during the Conservative Party conference, when they will undoubtedly be determined to ram their myths about higher employment down all our throats. Over to (in this case, the very appropriately-named) Flip Chart Fairy Tales:

“Labour economics used to be easy,” lamented David Blanchflower in Monday’s Independent. He continued:

All you had to do was watch the unemployment rate and that told you most of everything. As it went up things were bad and pay weakened. When the unemployment rate fell that meant the economy was getting better and that meant pay rises. Low unemployment meant big pay rises. High unemployment meant smaller rises. Simple.

But, over the past few years, falling unemployment hasn’t led to higher wages in the UK or the US. If anything, wages have continued to fall as employment has picked up.

The picture is even stranger when you look at skills. Employers have been talking about skills shortages for some time now. Earlier this week, the UK Commission for Education and Skills (UKCES) published a paper saying that Britain is already facing a skills challenge and that the country will need 2 million more highly skilled workers by 2022.

UKCES expects the skills profile of the workforce to polarise over the course of this decade, as there is an increased demand for jobs at the high and low skill end while demand falls in the middle.

Screen Shot 2014-09-23 at 18.40.51

That’s not what seems to have happened since the recession though. The ONS data on skills indicate that the employment recovery has been largely a highly skilled one. This chart in the Bank of England’s inflation report shows that, while a lot of the very recent job growth has been in lower skilled occupations, most of it since 2010 has been among the higher skilled. (Definitions are based on the Labour Force Survey categories.)

Screen Shot 2014-09-18 at 18.18.57

I wondered how much of that might be due to the self-employed bigging themselves up in the Labour Force Survey. As the ONS said:

The nature of self-employment is such that many people manage their business and are therefore likely to state they are in a managerial role despite the level of responsibility they may have.

Using at the ONS data and applying the definitions the Bank used, I broke the same period down between employed and self-employed.

Skills1 2010-14

Among the employees, even more of the increase is accounted for by those in the highest skill groups, so bang goes that theory.

Take the figures over a longer period, since the start of the recession, though, and things look even more skewed.

Skills1 2008-14

Almost all the increase in employment since the recession has been among the more highly skilled groups. There are still fewer medium and low skill employee jobs than there were six years ago.

There’s something else funny going on here, though. We’ve just had the longest decline in wages for half a century. It looks even worse if you include the self-employed.

Screen Shot 2014-07-10 at 16.43.58

Since the recession, pay has fallen by about 12 percent yet, over the same period, almost all the net gain in employment has been among the most highly skilled occupational groups. So we have a more highly skilled workforce earning a lot less.

Some of this may be due to the hours people are working, or not working. All the net increase in employment since the recession has come from self-employment or part-time jobs. Last week’s figures showed a slight fall in the number of employed full-time jobs for the second month running. There are still fewer people in full-time employment than there were in 2008.

There’s more – and you’ll have to visit Flip Chart Fairy Tales to read it.

Follow me on Twitter: @MidWalesMike

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The fakery and failure behind the DWP’s new ‘health’ scheme

131109doublespeak

It seems that the Department for Work and Pensions is sticking to the ‘Adolf Hitler’ model of public relations: If you tell a big lie and repeat it often enough, people will believe it. The press release announcing the new ‘Health and Work Service’ is riddled with long-debunked old lies – and one new statement that deserves our scrutiny.

This is the press release used by the BBC in its article on Saturday, telling us that the new, privately-run service is needed to combat the high cost of long-term absence from work.

It seems to be the DWP’s new practice to pass announcements to – let’s call them “trusted” – media outlets before putting them up on the government’s own press website, as a kind of test-run, allowing any credibility problems to be fixed before the government commits itself in an official way.

That’s why the announcement appeared on the government website yesterday (Monday) – two days after the BBC broke the story. Now – in just half the time it took to appear – let’s look at why it’s a load of rubbish.

“As many as 960,000 employees were on sick leave for a month or more each year on average between October 2010 and September 2013, the government has revealed,” the document begins.

Oh really? The DWP reached this figure by applying the findings of a survey, showing the ratio of long-term absences to total days of sickness absence, to findings by the Labour Force Survey showing the total number of days of sickness absence in the UK. That’s 9,000 sick days and 70 absences, applied to an average of 120 million sick days per year. This is based on 2,019 interviews with employees. There’s just one problem.

At the time covered by these surveys, there were around 4.9 million private sector employers.

Considering the huge size difference between the sample surveyed and the body it represents, it seems unlikely in the extreme that the figure is accurate. If it is right, it would be by luck; it’s probably wrong. The figure might as well have been made up – and you should treat it as though it was.

“The government has already taken big steps in getting people on long-term sick benefits back into work as part of the government’s long-term economic plan, with almost a quarter of a million coming off incapacity benefits since 2010-” Let’s stop there and examine the information content of this sentence so far.

The “government’s long-term economic plan” is a phrase that is being shoe-horned into every press release possible and means nothing. There never was a “long-term economic plan”, and there isn’t one now. Have you seen it? Of course not – it doesn’t exist. This is just a comforting nonsense inserted to lull people into false security that somebody knows what they are doing; I suspect the newly-privatised “nudge” unit may have had something to do with this.

As for “almost a quarter of a million coming off incapacity benefits since 2010”, check out this interview with Iain Duncan Smith, published in the Telegraph & Argus in 2010. He said: “I intend to move 1.5 million off incapacity benefit by 2014.”

It’s now 2014. We don’t have up-to-the-minute figures but on November 13 last year, the DWP press office helpfully tweeted us its then-current figure for people moving off incapacity benefits in a handy chart: 156,000.

140211fakes

That is a long way from a quarter of a million, and only around one-tenth of the Secretary-in-a-State’s 2010 target.

“- and almost a million who put in a claim actually have been found fit for work.” This is a bare-faced lie. It relates to a statement that 980,400 people were judged capable of work between 2008 and March 2013, but there are two problems with this. Firstly, it does not take into account the number of successful appeals against the ‘fit for work’ judgement (125,700); when adjusted to account for these, the total drops to 854,700. Secondly, this refers to the cumulative number of ‘fit for work’ outcomes of initial functional assessments since October 2008, and it seems likely that many people will have made repeat claims after being knocked off-benefit by an adverse decision. We do not know how many people have done this. Therefore the figure is meaningless.

So far, the DWP has told us that working people get sick (no surprises there), that it has failed to reach its target for clearing people off incapacity benefit and that its work capability assessment system is failing to push as many off-benefit as it should, because it is riddled with errors.

How does this connect with the creation of a new ‘Health and Work Service’, dedicated to ensuring that people who spend more than four weeks at a time off work with an illness get back into their job with a minimum of difficulty?

It’s obvious, isn’t it?

This is a scheme to ensure that people are discouraged from claiming incapacity benefits; the idea is that a drop in new claims, coupled with the number of uncontested ‘fit for work’ decisions, might lead to a larger drop in the number of active claims – which means the amount of money being paid out in benefits would also drop.

Inclusion of the word ‘health’ in the title of the new service is misleading, as it seems unlikely that consideration of an employee’s physical condition will have anything to do with the aim of the exercise.

Look at what the release has to say: “The Health and Work Service will offer a work-focused occupational health assessment and case management to employees in the early stages of sickness absence.”

It continues: “The work-focused occupational health assessment will identify the issues preventing an employee from returning to work and draw up a plan for them, their employer and GP, recommending how the employee can be helped back to work more quickly.”

Health doesn’t get a look-in.

No, what we’re most probably seeing is an expansion of the “biopsychosocial” method employed in work capability assessments, in an attempt to convince sick people that their illnesses are all in their minds. Don’t expect this approach to be used for people with broken limbs or easily-medicated diseases; this is for the new kinds of ‘subjective illness’, for which medical science has not been prepared – ‘chronic pain’, ‘chronic fatigue syndrome’, fibromyalgia and the like.

People with these conditions will probably be sent back to work – with speed. Their conditions may worsen, their lives may become an unending hell of pain and threats – I write from experience, as Mrs Mike spent around two years trying to soldier on in her job before finally giving up and claiming her own incapacity benefits – but that won’t matter to the DWP as long as they’re not claiming benefits.

That is what we can all expect from the new ‘service’.

It will be a fake, necessitated by failure.

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