I was engaged in a twitter argument yesterday with someone who was disputing the progress we have seen in employment, putting the improved figures down to a million people enslaved on zero hours contracts.
The Office for National Statistics have provisionally estimated the number of zero hours contracts to be between 583,000 and 1.4 million. There isn’t an established data series for this that would enable historical comparisons, but there are such statistics for full time and part time workers. According to these the number of part time workers is up 356,000 since May 2010, and the number of full time workers is up 1,114,000.
Let me re-emphasise that point. Not just a million private sector jobs, not just a million net jobs, but a million net full time jobs have been created since the coalition was formed.
You can see my calculations here, based on data from here (A01)
A footnote on sheet 3 of A01 indicates that “The split between full-time and part-time employment is based on respondents’ self-classification.” suggesting that nobody has been classified as full time who is not able to work full time.
Now an unemployment rate of 6.8% is still too high (down from 7.9% in 2010), and for 26.9% of jobs to be part time (down from 27% in 2010) when many of those people may wish to work full time, is also still too high. But the signs are that we are moving in the right direction and need to keep going.
Zero-hours has been debated before on this site, and Vince Cable has been, rightly, looking into the issue and is prepared to act on abuses. The opposition has also been making noises on this issue, largely to distract from what is overall a strongly improving picture on unemployment.
Employment up 1.5 million. Unemployment down 282,000 despite a growing workforce. 76% of new jobs are full time jobs meaning that the proportion of all jobs that are full time has increased.
Maybe we could have done even better? Perhaps.
A basic analysis would say that Germany escaped the worst of the credit crunch and recovered quickly with help from a weakened Euro. France, under Hollande, is seeing unemployment still rise. The UK has escaped the debt default fears that have hit Spain (despite a higher post-crunch deficit), and is creating jobs faster than the EU average.
These facts are toxic to Labour’s strategy and message. Understand them and use them.
* Joe Otten was the candidate for Sheffield Heeley in June 2017 and Doncaster North in December 2019 and is a councillor in Sheffield.
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27 Comments
Joe
It used to be the case that the ONC was giving the 583,000, but after intervention revised the figure this April to 1.4 million. I am surprised that you didn’t know this – especially given that Cable made a damning comment on it. Here is the Beeb reporting his comment
“following the release of the ONS figures Mr Cable said it was also clear there had been some abuse of those on zero hour contracts by some less scrupulous employers.”
http://www.bbc.co.uk/news/business-27219654
I suspect that some of your twitter debaters are thinking of the so-called fake hairdresser phenomenon ( people declaring themselves self- employed to avoid some of the alleged perverse consequences of welfare reform). The Yorkshire Ranter (a seriously interesting blogger( had a post explaining what is meant by this.. What do you think Joe?
http://www.harrowell.org.uk/blog/2013/03/03/the-transition-towards-a-low-trust-society/
What annoys me is the comments on “Youth Unemployment” with talk such as “lost generation” yet even at its worse over 80% and usually nearer 90% are in employment (or education). While the unemployment levels are not good and it is terrible for the individuals concerned the media project an unreasonable image of job chances to the young. They are overwhelmingly likely to get a job if they wish to find one.
The claim to have created a million new private sector jobs has been in doubt for some time – this article from the Guardian 2 years ago suggests that a) it was already being made 2 years ago! (so how many have been created since?), b) the number of jobs has been growing, with barely a blip for the recession, for over a decade, and c) the balance between private v public jobs has been seriously distorted by reinventing some public jobs as private ones. No doubt the neoliberals who think ‘Private good; public bad’ will rejoice at that, but since the reverse was true under Labour (e.g. banks being brought into the public sector), we could cautiously infer that Labour did just as well, if not better, than the Coalition at creating an environment where private sector jobs could flourish. A Keynsian approach to public spending after 2010 might well have yielded better results, sustaining demand until the private sector began to recover, and the debt could be reduced by a combination of reduced spending AND increased tax receipts. Instead, Lib Dem Ministers gave in to Mervyn King’s alarmist panic over the (always remote) possibility of UK Government default, and implemented an austerity which stalled the economic recovery for three years. While reflationary policies like Help-to-Buy have begun to get things going prior to 2015 (the usual Tory tactic – also used by New Labour to some extent), the massive public sector cuts Osborne has lined up for post 2015 may well deliver a serious and sustained setback, in the event of the Tories – or the present Coalition – continuing in office after that.
Sorry – this article: http://www.theguardian.com/politics/reality-check/2012/oct/10/conservative-conference-2012-davidcameron
The assumption behind much of the thinking on Part-Time work is that its second best. We measure the numbers of Part-Timers who would prefer to work Full-Time but we dont ask Full-Timers if they would prefer shorter hours. We should be measuring both, then we could make meaningful comparisons.
In the long-term we should be looking to a world where most people have several income streams to provide freedom& security.
Lets be honest zero hours contarcts was probably shorthand for low paid jobs whether they are zero hours, part-time or full time.
And of course there is the raising of the pension age which means many people who might have stopped working have carried on. I am not convinced that more people working than ever before is an entirely good thing.
‘These facts are toxic to Labour’s strategy and message.’
Use them and you help get the Tories elected. Why can’t Lib Dems see that in talking up the coalition’s record the main beneficiary is the Conservative party? I hear Stephen Williams talk about the Lib Dem half of the coalition. Nobody believes the Lib Dems are half of the coalition. They run two government departments. The coalition is inevitably dominated by Tories. They have the vast majority of ministers and MPs. It’s silly trying to pretend otherwise.
If you think a Tory dominated government has done a great job you vote Tory. It’s simple.
Sorry, Joe, I don’t believe it. And I don’t expect the voters will either.
Working (as I do) with a lot of unemployed younger people I find that there is a definite disconnect between the reality of their day-to-day experience of looking for meaningful employment and the type of figures I see presented here. I can’t dispute them, I don’t have data for what we do, but speaking as one of those at the sharp end, sleeves rolled up doing something to try and help others I have to say I struggle to share the optimism that figures such as this should engender.
“These facts are toxic to Labour’s strategy and message. Understand them and use them.”
Is this the centrist version of putting “FACT!!!!” at the end of any post?
Responding to comments:
1. A social liberal: The 583,000 and 1.4m figures measure slightly different things (workers and contracts) so the one is not a revision of the other. However nor are they consistent. The ONS summary is worth reading in full here.
2. Edis, the table I link to also has self-employment numbers, and they bear out my message. The Yorkshire Ranter appears to be assuming that there is a huge fake hairdresser phenomenon and analysing accordingly, rather than looking for evidence that there is one. The data we have shows that if there is one, it is displacing other part time work, alongside growth in full time work.
3. GP, you are right that there was an argument early in the million jobs campaign over the classification of public/private sector. That argument was pretty quickly overtaken by the creation of more private sector jobs – so it became merely an argument over whether the claim was made too soon or not. Now we have progressed even further to a million and a half net jobs. The net figure is obviously unaffected by private/public classification.
4. Paul, you are quite right, though in my defence, in the context of economic good news such as this, underemployment is a more salient problem than overemployment.
5. Frank. The Tories deserve the lesser part of the credit for this, for two reasons. 1. Increasing the personal allowance has boosted employment opportunities by making more jobs worth doing. 2. The appreticeship programme has boosted direct opportunities and skills. These are both distinctively Liberal Democrat initiatives. However the Tories do deserve some credit, and the charge that Labour governments always increase unemployment has some merit. The choice between Liberal Democrat and Conservative comes down to whether you want a fairer society.
6. Jenny, what do you think the unemployment rate is, and why?
7. Maggie, youth unemployment is worth another article of its own. I have no doubt that many young people find it very difficult, but as youth umemployment has at last started to come down after a decade of going up, then fewer people – though still too many – are finding it difficult.
Could it be that jobs that took place in the black market are now declared due to the benefit regime
You asked about do folk believe the figures, running into the last election many times the number of people of working age not working was quoted perhaps a comparison there would be useful. You should also take incapacity benefit change into account two things changed the way it was exempt from being taken off a partners income and Atos with fear and menace (think parliament at pmqs using former kings bones as fit for work)
Also ask parents who have school leavers that do not fall into a nice category and a still forced to pay all costs as the state does not want to know.
Figures are notorious for being twisted, long term unemployed sanction them remove from stats long term unemployment looks better. Zero hours better for some hands up who believes that. Higher tax threshold does not exempt NIS and importantly no NIS payment no pension accrual.
So my message if more people are employed you need to show that less people of working age are without work otherwise you support its immigration that’s improved the total in work.
Allan, yes, lots of things could be happening, but it would be reckless to presume they are all working in the same direction and materially affect the big picture. More data would obviously be useful.
Incapacity benefit changes, for example, if people are passed fit for work, they become unemployed rather than inactive at that point, and this makes the unemployment figures worse. Other phenomena may well make them better. But I see no indication that the ONS might be systematically getting things wrong, and if they were, then a whistleblower won’t be far away.
Thatcher’s main contribution to fiddling the figures, remember was getting unemployed people onto incapacity benefit. If we are going in the other direction, that is surely unfiddling what had remained fiddled.
Hi Joe
As I understand it incapacity was for example paid to the ill person the figure was not means tested the coalition changed the rule on new claimants and I believe those who switched from incapacity to ESA in effect making ill health payment means tested after a certain duration I think twelve months. If my reading of the change is correct a married couple who had qualified for incapacity probably lost it when the partner earned something in the region of £180 pounds. The coalition make a big thing that the ill people would be helped into work my suspicion is they are still ill the partner now supports them and the working age person drops out of statistics
Things like mentioned above make me and I feel sure others suspicious that it’s immigrants who are boosting the total employed and the less fortunate are now outside of stats so ignored.
It is great that total numbers working has increased in yet if you took productivity which is low it for me supports my concern that the employment numbers are incorrect. Should we take hours worked and divide but earnings that is probably higher but at the expense of lower paid.
I hope that while we may not totally agree about what figures say my point for the party is if you wish the population to believe the figures it need to be shown the working age population not in work has reduced this was a key stone of the attack on welfare
The productivity puzzle is perplexing. How is it that official data suggests strong growth in employment over the past three years while the economy has shown lacklustre growth? And how is it that whether it is measured in output per hour or as output per worker, the UK’s productivity is so far behind its peers?
One answer could be that the numbers going into the calculations for the UK just aren’t accurate enough. What if the Office for National Statistics has overstated employment growth in recent years? Maybe there are not so many jobs after all. That’s the conclusion of Chris Williamson, chief economist at Markit, the data company behind the closely watched PMI surveys of business activity http://www.markit.com/assets/en/docs/commentary/markit-economics/2013/oct/UK_Surveys_and_Productivity__13_10_22.pdf
Joe Bourke – I don’t think it’s a puzzle at all. It basically means that labour in the UK is dirt-cheap. The really terrifying number for the UK economy is investment which answers your point about productivity. See http://en.wikipedia.org/wiki/List_of_countries_by_gross_fixed_investment_as_percentage_of_GDP.
The essential upshot is the devaluation of labour. Hence you get the strong (ish) employment figures Mr Otten talks about, with people working three of those jobs needing benefit to put a roof over their head.
I disagree with the article, this is not toxic to labour, it is exactly what they have been saying about standards of living – that people even with a far-from-poverty income still are in a bad way. I stress that I’m not for a moment saying I think that Labour have any answers. But Mr Otten’s article seems to me to resonate with Labour’s message.
Allan – Immigration is an interesting one because ‘categories’ of people are affected (or not) in different ways. This is an interesting study, notably p64-65
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/257235/analysis-of-the-impacts.pdf.
“3. GP, you are right that there was an argument early in the million jobs campaign over the classification of public/private sector. That argument was pretty quickly overtaken by the creation of more private sector jobs – so it became merely an argument over whether the claim was made too soon or not. Now we have progressed even further to a million and a half net jobs. The net figure is obviously unaffected by private/public classification.”
Joe, the problem is that often the Public Sector would hire ‘one’ highly skilled person to do the job, whereas the Private sector has a habit of hiring three cheap, but unskilled people to do half the work, so there is some merit to GP’s point.
Where are all these jobs? If you go into a job centre in the North West where I do a lot of business or Lincolnshire where I live, there are very few full-time jobs and not that many part-time. If you look in the local papers where several years ago there were many pages of jobs, it’s now normally down to less than a page. I’m afraid whether it’s Tuition Fees, the EU, Welfare, Scotland or Employment political parties will always find figures to suit their arguments. The sad thing is – like Danny Alexander the other day in Scotland – they have no shame even when they are found out.
Little Jackie Paper,
I am not sure cheap labour costs can explain the puzzle. Lower labour costs are normally reflected as higher labour efficiency I.e output/labour costs. The standard Labour productivity measure is the amount of goods and services produced by one hour of labour. Official data shows over 1 million new workers joining the labour force between 2010 and mid 2013 and a commensurate % increase in hours worked. This contrasts sharply with other sources of economic data showing relatively flat growth in employment and hours worked until the third quarter of 2013. These estimates are commensurate with both the low GDP growth and persistent unemployment that we have seen until mid-2013.
The more recent data on robust GDP growth and steep falls in unemployment is far more consistent with expectations based on the job creation figures reported since mid-2013.
@malc
Yes, I’m curious as to where all these jobs have apparently been created and which sector(s) they are in. A million full-time jobs is a massively substantial number, so there must be a truly fascinating graph somewhere that shows employment trending up in certain sectors – which ones though?
According to https://www.gov.uk/government/news/employment-rate-hits-5-year-high-fuelled-by-private-sector-growth there is a significant reduction in public sector employment and a much larger increase in private sector employment. Frustratingly, this news doesn’t break down which parts of the private sector are seeing meteoric growth, or where these jobs are geographically.
There is a Grauniad article, however, suggesting that 80% of new private sector jobs are in London (http://www.theguardian.com/uk-news/2014/jan/27/great-migration-south-private-sector-jobs-london), and that London has also ‘bucked the trend’ by seeing an increase in number of public sector jobs, which doesn’t surprise me since Westminster will always feather its own nest if permitted to do so, bless it.
Reference table: Regional Labour Market: HI00 – Headline LFS Indicators for All Regions, May 2014 (Excel sheet 7452Kb) is interesting. From a quick graph, the dataset (2012 to 2014) suggests that the areas which have seen the least reduction in absolute numbers of unemployed people are Y&H, W Mids, SW and NE, which have pretty flat trendlines over the data given in the tables. NW, East, E Mids, SE and London have seen a noticeable reduction in absolute numbers of unemployed over that time period.
It always amazes me how economies seem to improve just in time for elections. One would almost think they were optimistic readings of conflicting and ambiguous data
Glenn, you’ll notice from the graph that UK unemployment peaked in late 2011 and started falling more sharply in the summer of 2013.
Joe Otten
“The Office for National Statistics have provisionally estimated the number of zero hours contracts to be between 583,000 and 1.4 million.”
Is that correct that we could have up to 1.4 million “employed” people on zero hours contracts? I’m not sure the 1 million new jobs claim would be very impressive if it is based almost entirely on zero hour contracts.
Hi malc, did you read the article? There are more than 1 million more full time jobs than before.
Joe,
we were getting a lot of push-back and incredulity when we were canvassing with the million jobs campaign last year as it was not ringing true with many peoples experiences or feelings of friends and family having continuing difficulties in finding work. I think we are seeing improved conditions translating into more job prospects now and in recent quarters the jobs data and economic data appear to be back in correlation. Hopefully, we will get a better reception on this message as the year goes on.
I am afraid I would never have the gall to canvass the idea that the “million extra jobs” were a great deal to do with anything the Lib Dems were doing in Government!! I am not surprised you had a lot of “push-back and incredulity”, Joe!