- “Strivers”, “idealists” and “acutely precariat” among the new classes uncovered by researchers’ interviews and a Populus survey of 2,000 people.
- Think-tank issues stark warning that economic insecurity is “the new normal” as the digital economy gathers pace, with 40% of working Brits holding under £1000 in savings.
- Government must give the self-employed maternity/paternity leave, devolve the Living Wage to councils, and introduce universal childcare to address insecurity.
Britain is dividing into SEVEN new classes of worker as the gig economy grows, according to leading think-tank the RSA [Royal Society for the encouragement of Arts, Manufactures and Commerce].
Striving, Thriving or Just About Surviving launches the RSA’s Future Work Centre, following RSA chief executive Matthew Taylor’s employment review for Theresa May.
The report warns of a 30:40:30 society: while around 30% live comfortably, economic insecurity is “the new normal” with 40% just managing and a bottom 30%not managing to get by.
A new online tool [available for media re-use], released as part of the research, lets users explore which new ‘class’ they are, based on interviews and a survey of more than 2,000 people by Populus.
The survey, previously unreleased, reveals economic insecurity is widespread in the UK:
- 43% of workers do not have anyone in their household whom they could depend on to support them financially in the event of hardship.
- 32% in-work have less than £500 in savings, 41% have less than £1,000 and 29% are concerned with their level of debt.
- less than half of employees (44%) feel they have progressed within their careers over the last five years, and only 40% feel they have good opportunities to progress in future.
Britain’s new classes uncovered: are you a ‘striver’, an ‘idealist’ or ‘chronically precarious’?
- The Chronically Precarious: the reliably broke, this group is typically on a steady contract albeit with low pay. 60% have less than £1,000 saved and they have low job satisfaction and little autonomy at work. Typical job: sales assistant.
- The Acutely Precarious: typically broke and experience significant income ”yoyo-ing”. Work is low-paid and unlike the Chronic Precarious, irregular. This is a young group and 45% have a degree. Typical job: hospitality.
- The Flexi-workers: love their job, even if it doesn’t pay well: 83% are satisfied but 59% earn less than £21k. High levels of savings: many are redundant ‘second careerers’. Value autonomy above security. Typical job: freelance photographer.
- The Steady-Staters: feel well-treated (90%) and well-paid (69%), even if work is a means to an end. But they have low-savings, and rely on work for income so are vulnerable to a shock: their routine jobs are at high-risk of automation.Typical job: local govt admin.
- The Idealists: mid-earning, passionate and often millennials (50% under 35), 70% think they make a positive contribution to society. Most likely to rely on others e.g. parents for income. Urban and 25% have more than £10k saved. Typical job: charity worker.
- The Strivers: regular job with high income and high savings, but they feel the link between hard work and fair pay is broken: 73% are stressed but only 20% think their pay reflects this. Typical job: senior train manager.
- The High-Flyers: the wealthiest group: 55% have more than £10k in savings. Successful at exploiting automation: most likely group to value new technology. High job security, high autonomy and high fulfilment. Typical job: director of an IT services business.
Information is based on RSA/Populus survey of 2,000 people and RSA qualitative interviews. Infographics and data available on request.
Precarious finances are a daily reality for two new classes (the ‘chronically precarious’ and the ‘accutely precarious’) and other groups like the ‘Steady Staters’ will likely experience this regularly in the future as automation takes off, the report warns.
Researchers note ‘flexibility’ offered by the growth in atypical forms of employment such as gig work is valued by some groups, like the ‘flexi-workers’, who welcome how the gig economy lets them pursue creative projects. But for the ‘chronically precarious’, ‘flexibility’ is weighted on the side of the employer.
Brhmie Balaram, report author and senior researcher at the RSA, said that automation is only one part of modern insecurity:
“The gig economy has rightly captured the public’s imagination in recent years. People who find work on platforms often struggle to make ends meet as they go from job to job, with no sick pay and no entitlement to the national living wage.
“But our new research reveals that economic insecurity now stretches right throughout our labour market, including within jobs that appear safe on the surface.
“From retail workers to warehouse operatives, and from care workers to cleaners, we are beginning to uncover the hidden millions who are chronically broke year in, year out.
“Let’s not get distracted by automation and machines coming after our jobs. The real danger for this group of workers is a childcare bill unpaid and yet another rent rise around the corner.”
Universal childcare call
The report concludes that state support must be overhauled to address rising insecurity:
- Giving councils a larger role in their local economy including by devolving the Living Wage to local authorities and/or Mayors.
- Addressing low-pay, poor skills and job progression, and the effect on insecurity, through establishing powerful sectoral bodies to bring together employers and workers modelled on Swedish Job Security Councils.
- Helping individuals adapt by increasing incentives to save and introducing personal budgets to retrain as automation hits: half of workers have had no training since they left school, the study notes.
- Expanding workplace rights for the growing self-employed – a key target group for both main political parties – by offering them state-funded paternity pay and/or adoption leave, funded by their National Insurance contributions.
Anthony Painter, director of action and research at the RSA, added economic insecurity is the ‘new normal’:
“Economic insecurity is the new normal and policymakers must address this.
“In the 2000s we saw pay delinked from productivity and in the last decade we’ve seen economic security de-coupled from having a job. So just as we rightly celebrate high levels of employment, the challenge of economic security remains enormous and may even be getting more difficult.
“We need rights, responsibilities and a modern social contract based on support for people as they navigate the inevitable change that is coming from changes to the cost of living, technology, and Britain’s international competitiveness. If we can provide proper support then this will share future growth opportunities more equitably and help the economy better meet the needs of all.
“Without very significant action on skills, transition between jobs and up the earnings ladder, greater support for families in the form of childcare and parental leave, and new rights for key groups of workers such as the self-employed, we will remain in a situation where only a third can really be seen as properly economically secure.
"A sense of national urgency is required.”
Populus interviewed 2,083 adults online. Populus’ online omnibus speaks with a nationally representative sample of adults 18+, with quotas set on age, gender and region and the data weighted to the known profile of Great Britain using age, gender, government office region, social grade, taken a foreign holiday in the last 3 years, tenure, number of cars in the household and working status.
About the RSA Future of Work Centre
The RSA believes that a better world of work is possible. With practical interventions, thoughtful policy change and bottom-up movements, we can ensure that everyone has the chance to flourish in a vocation of their own.
Following RSA chief executive Matthew Taylor's employment review for the Prime Minister, the Centre will explore what it would take to close the ‘good work gap’ and allow everyone to find a job that is economically secure and empowering. The Centre will build backing for a fresh social contract underpinned by credible policy and practice reform, covering taxation, welfare, lifelong learning, and employee voice.
The project will build on the RSA’s rich heritage of research on modern work issues, including the rise of self-employment, the impact of automation and the spread of gig working patterns. Building on our ‘‘Think like a system, act like an entrepreneur’ methodology the Centre will use scenario forecasting, qualitative surveys, sector deep dive workshops, policy roundtables and extensive data mining of government datasets.