The pandemic kick-started new ways of thinking around employment.
As the Covid-19 pandemic enters its third year, it is time to take stock of the wild and wonderful predictions about work that greeted its arrival. Remote work? Here to stay, albeit most likely via the hybrid 'home and office' compromise for those who can. An acceleration in the use of digital services? Yep, RSA research last year found the proportion of retail transactions conducted online grew as much in the first five months of the pandemic as it did in the previous five years. A change in our collective values towards the purpose of work? Perhaps. Certainly, for those able to work from home, survey evidence routinely suggests an increased demand for work that better supports their wellbeing, flexibility and work–life balance.
However, arguably the most consistent prediction about work from the pandemic's early phase has proven to be categorically wrong. Because for all the undoubted economic pain many businesses have endured, what we have not seen – at least in the UK – is a return to the mass unemployment that accompanied recessions in the 1980s or 1990s. Indeed, according to the Office for National Statistics, Britain's labour market is showing remarkable signs of rude health. Both employment and unemployment levels are only fractionally worse than their pre-pandemic levels, which is astonishing considering the UK entered the crisis with record highs and lows, respectively. Furthermore, we also currently enjoy record levels of job vacancies. Yes, there may be a small data lag and the recent Omicron wave could yet dampen spirits. But this is still nothing like the scenario envisaged at the beginning of the pandemic.
What explains this yawning chasm between expectation and economic reality? As ever, there are a number of competing hypotheses, but central to all is an acknowledgement of the extraordinary success of the government's Coronavirus Job Retention policy. Even in the long-view history of Britain's welfare state, it is hard to imagine a policy as huge or as effective as 'furlough'. At its peak, nearly 9 million workers – over a quarter of the entire workforce – were paid 80% of their wages by the state explicitly not to work. To put it mildly, this did not come cheap. But as we look at the robust state of the employment picture today it is hard to argue against a verdict of 'job done'.
The question now is what comes next. After all, it does not seem unreasonable to think a policy of such magnitude could shift attitudes towards work, welfare and society. There are some early signs that it might. In the latest data from the British Social Attitudes survey, the number of people who say benefits are "too low" now clearly outnumbers those who say they are "too high" for the first time since the turn of the millennium. Equally, recent analysis of the Labour Force survey carried out by The New Statesman magazine found that the much talked about 'great resignation' phenomenon is more prevalent in lower-paid occupations such as "retail and customer service workers, bar and wait staff, agricultural labourers, machine operatives and cleaners". In other words, in Britain, the exodus from the labour market is much more a story about material terms and conditions in hard-pressed, pandemic-hit sectors than it is about anti-work, passion-project-seeking professionals.
From this data it seems reasonable to ask two further questions. One, might the experience of furlough and the pandemic have driven this collective reappraisal? And two, if so, what are the opportunities for good work?
The RSA has long argued that part of the appeal of a more generous safety net is that it allows people to say no to bad terms and conditions. Moreover, if we provide people with the security to view labour market and lifelong learning opportunities with an increased element of choice, it could be beneficial for both individual aspiration and long-term productivity.
In France, working alongside our partners Bayes Impact and the Mastercard Center for Inclusive Growth, we are testing a digital coaching platform that seeks to support low-paid young workers towards better opportunities. Our hope is that a Jobcentre Plus reimagined more along these 'active labour market' lines – with a focus on supporting people into better work, not just any work – would be both good for workers and help provide the institutional coordinating glue that has long been missing from our lifelong learning systems.
Sadly, rather than explore the lessons from its own outstanding policy success, the government seems intent on returning to the pre-pandemic world of punitive welfare conditionality. In January, it announced a reduction from three months to four weeks in the amount of sanction-free time people who are unemployed and claiming Universal Credit have to find work in their chosen field. This is a retrograde step on its own terms, but it also misses the central lesson of pandemic statecraft: it is not enough to think only about how we make the state efficient; we also must consider how to make it resilient to unexpected shocks. Welfare states must now help people adapt to changing circumstances quickly, not tell people to 'stay in their lane' at all costs.
From climate change to automation and rising economic insecurity, such shocks seem scarily present in our expectations of the future. To flourish despite them, we will need institutions that find new ways to protect insecure citizens. The RSA remains at the vanguard of trying to create them.
Alan Lockey is Head of the RSA's Programme for the Future of Work.
- Follow Alan on Twitter @Modern_Lockey.
This article first appeared in the RSA Journal Issue 1 2022.
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