Wages are low, costs are high, and people need welfare to survive. This is partly the Tories’ fault; they need to fix it

After a brief respite, benefits are back on the agenda, with Work and Pensions Secretary Iain Duncan Smith releasing new figures showing that a million people capable of working are “stuck” on benefits.

His report, out today, is bound to get lots of people very, very angry, yet again, although after phrases such as “social cleansing” and a “final solution” where can critics go now? The killing fields?

I suspect that this kind of language, which just makes people sound demented, only helps the Conservatives, who have strong public support on welfare reform. People don’t like free-riders – it’s basic evolution.

Yet the Tories have not seemed to address the crux of the problem – that in a low-wage economy with high living costs (especially housing) those at the lower end of the skills spectrum cannot survive without the state. This is a problem at least partly of the Conservatives’ making.

Iain Duncan Smith’s own think-tank, the Centre for Social Justice, stated in a 2009 report, Dying to Belong, that:

Deindustrialisation in the late 1970s gave rise firstly to high unemployment and secondly a new type of labour market. This ensured that a significant proportion of the working class became, instead, the workless class, and the first to be hit were second and third generation non-white migrants.

Especially hard hit were young people, and in particular males. Between 1984 and 1997 employment amongst 16-24 year olds decreased by almost 40 per cent. By winter 2007 youth unemployment was even higher, up 70,000 on its 1998 level.

Work is one of the key activities of mainstream society. Work provides a structured and inclusive experience and has been proven to aid mental and physical health.

In addition, with deindustrialisation came a shift in the type of jobs available to young people with few qualifications. Whereas in the past trade apprenticeships would have provided skilled employment with a decent wage and future prospects, the rise of the knowledge economy has shifted away from this to low skill, low pay, low prospect jobs. In this scenario, gang culture, and the possible wealth available from associated activities such as drug dealing and acquisitive crime, can appear the most attractive option: gangs, after all, do not have glass ceilings.

I used to be one of those true believers in the market who thought that deindustrialisation was a necessary evil to free us from union terror/the three-day-week/the dead going unburied. But it’s hard to dissociate the problem of low wages with Thatcherism or neo-liberalism. There are social factors too, but IDS must realise that Tory economic policies are involved.

The unfortunate fact remains that, in our high-churn, low-wage economy, too many jobs do not offer people enough to live on without the help of benefits, and the Conservatives helped to create this situation. The generous welfare state was a quid pro quo (a pretty lame one) for an economy that depended on a permanent reserve of unemployed labour.

This was bad enough under the Conservatives, but under New Labour this reserve had to compete with an almost limitless supply from abroad. IDS’s report focused in particular on urban minorities, especially descendants of West Indian immigrants in the 1950s, and one of the many cruel aspects of mass immigration is that migrants are often brought over to do temporary work, and then discarded, and their children must then compete with newer, keener migrants.

Earlier this month Boris Johnson wrote that immigrants win out in jobs because Brits are not as hard-working; it’s certainly true that immigration allows us to sidestep problems to do with education and socialisation, but immigrants are chiefly able to take those jobs by working enormously long hours and on very low wages, and living in fairly appalling conditions, even in sheds. How can the English working class compete with this? And why should they, after struggling for centuries to get to where they are?

IDS is certainly right to look at the decline of apprenticeships and of traditional two-parent families, two changes that hit the working classes badly. But unless the Government has some secret plan to dramatically reduce the cost of living (primarily housing) or to increase wages at the bottom, I can’t see how benefit reform can be made to work.

As it is, Osbornomics seems likely to even further increase inequality levels in Britain, something that even we stuffed-shirted Tories should be concerned about; much as I think The Spirit Level is nonsense, highly unequal societies are not very pleasant places to live.

Perhaps the Tories need to look for inspiration from ConservativeHome’s “heroes and heroines of compassionate conservatism”, but I would even suggest an older, more eccentric choice, the French king Henri IV, who famously said: “There should be a chicken in every peasant’s pot every Sunday.” The Conservatives must aspire towards an economic system where a man on an ordinary wage can support himself and his family.

This article was published at Telegraph Blogs

Comments so far

  1. For a start the Gov’t could put strong downward pressure on energy prices, which are kept artificially high. There are, of course, the power stations that need to be preserved while Dr Pangloss’s followers chase the chimera of wind power, and the agenda to discourage more energy use than is necessary. But I can’t help thinking that a major drive in the constant hikes in energy prices comes from population controllers who see nothing wrong in older and more vulnerable people freezing to the death in the winter. Lower the energy prices, close the gates to this country, and you’ll get as close to a win-win as you ever do in real life.

  2. cynthia curran says

    Great Britain usually is pick on compared to Germany but Germany is a nation of renters and many work in the Mimi job market since they can’t find a full time job and Germany has not been great on immigration either. They have lower youth unemployment but the average German lives in a small apartment worst than the average English guy. In fact outside of London housing is cheaper in England than Germany.

  3. cynthia curran says

    As mention the trade school path in Germany has not provided employment for many people since there are many people in Germany that work at part time store jobs and get state dole as well. Its not bad to have some trade education but its not going to secure a job for everyone. Germany went to having 40 percent of the populations working in factories to only 19 percent, they even outsources some jobs to Mexico and the US.

What do you think?