During the recession, John McArthur put himself forward to work for LAMH Recycle Ltd in Motherwell, a social enterprise that reconditions computers. An electronics specialist, McArthur, now 59, had previously worked on factory floors, then retrained, moved into product development, and even started his own company. But like many in Lanarkshire, he found that a rich CV counted for little when facing a slump. Frustrated by unemployment, he seized on the chance “to sit at the end of line” at LAMH, “doing the final quality check, signing things off as good to go. It was minimum-wage work,” he tells me, “but I was more than happy to do it. I had experience to share.”
John was prepared for the fact that this placement, which was backed by a Labour government programme, would not last forever: it ended in 2011. Nothing, however, could prepare him for what happened next. Last summer, under a new coalition make-work scheme, he was informed that there was, once again, a post for him at LAMH. But the new “offer” came with a twist: this time John would be working without a wage. There would be no reward for 30 hours graft, only the threat of subsistence-level benefits being withdrawn if it wasn’t done.
For John, as for many others, the experience of this recovery has been “yes, you can work, but it might not be work as you used to understand it”. For some, the thing that’s gone is the expectation of a single workplace with a stable body of colleagues. For others, such as the growing army of zero-hours workers, it’s the old idea of a fixed working week that’s gone. And for all except the most fortunate, the old presumption that pay would gradually creep up has been upended: Britain has just been through the most severe wage squeeze since the 1860s.
John’s invitation to work for nothing is thus, perhaps, a case of wider trends being pushed to a logical extreme. But the case is emblematic of something else too - of welfare provisions created to help people through an hour of need being refashioned into an instrument of punishment. Strictures that purport to encourage people to pick themselves up are instead used to keep claimants in their place. There was, John says, “stony silence” when he asked what he was meant to gain in experience from going back to a job he had already done.
“I felt like dirt. I just think it morally reprehensible that a person is expected to work for no wage. It’s as simple as that.” So he wrote to his prospective wage-free employer, explaining why he had to decline. He received no reply; he simply found his benefits sanctioned. By Christmas 2014, body and soul were being kept together on a diet of “potato scones - special offer 8 for 6, 49p at Lidl - which does me for breakfast and lunch”.
Perhaps the most poignant feature of John’s story - with all the humiliation, as well as the hardship - is that it is playing out during what ought to be the return of happier times. This recovery may have been the slowest to get going in a century, but it is real enough: the economy has been bigger than before the bust for over a year. The bounceback in jobs has exceeded all predictions: the employment rate is a fraction of a percentage point off a record high.
But if the quantity of work has been a pleasant surprise, the quality is often a nasty shock. The creep of zero-hours working across the economy continues; the number of unwilling temps who would prefer permanent posts is scarcely lower than a year ago; and there are still twice as many unwilling part-timers as before the slump.
Since I surveyed all this in my book Hard Times, published last year, another form of casualisation has come to light: “self-employment”. Employers have been telling poorly paid staff, including hotel chambermaids and forestry workers, to pack their bags and come back as freelancers. Two-thirds of the first post-crisis jobs reflected workers going it alone, and there is no reward for the risks involved. Typical self-employed earnings have fallen 22%, three times the drop for employees.
The recovering jobs market is one in which employers can turn labour on and off like a tap - and with it their employees’ security. Hard Times points to the substitution of cheap, deunionised labour for costly capital investment to explain this position. It emphasises, too, the disappearance of middling clerking and technical jobs, and the proliferation of lowly jobs that involve servicing the rich. All of this stands up well in the unfolding recovery, but in updating the book a year on, what’s become clearer to me is the connection between low pay and the assault on social security.
The latest academic analyses acknowledge the “obvious possibility” that “increased pressure to take low-wage work” among benefit claimants is now making them more “substitutable” for employees in the bottom third of the range. This is exactly what we should expect. Minimal welfare with maximum stigma is, after all, a mix that has long been familiar in the United States, where typical male wages have now stagnated for 40 years. The more stories like John McArthur’s that come to light - stories about hardship and harsh rules pressing people into inappropriate work - the less surprised we should be if employers skimp on terms for existing staff. Why wouldn’t they when, in John’s phrase, “an army of conscripts from the Department for Work and Pensions” provides a ready, cut-price alternative?
David Cameron’s game plan for the election is to rally strivers against shirkers, a strategy that was confirmed last month when he promised a fresh tightening of the benefit cap. This crude mechanism is a singularly stupid way to advance any conceivable objective bar one: the creation of a false opposition between the interests of the jobless and “hardworking families”.
The election will reveal whether putting such weight on this distinction is clever politics. But it is already apparent that it is dreadful economics. For the reality is that the overworked and the underworked are absolutely “in it together”. Bullying through the benefits system soon translates into degraded pay and terms. The upshot – Labour, take note – is that anyone serious about standing up for the strivers must fight back in the war on welfare.
