Based on the figures presented.

Rise in Part Time positions since the Election, read from the large version of the graph presented.

% part time jobs in May 2010 when the Lib-Con coalition came to power: ~27.0%
% part time jobs in Jan 2011, the latest figure suppied: ~27.1%.

Hmmm.

0.1% increase.

“Rapid growth”. I’m convinced.

Clearly an existential crisis, and clearly entirely related to the Lib-Con period of power.

If you lack affordable childcare, how come you can afford a part time job but not a full time job?

What exactly is the relationship between de-skilling, so jobs can be done equally well by min waged unskilled as experienced skilled workers, and the rise of part time work? Are unskilled jobs more likely to be part time? Why?

And What does it have to do with age? My local supermarkets employ workers of all ages. Are you suggesting these new part time jobs are held by younger workers?

What does 24 hr production have to do with it? Nissan’s Sunderland plant is running 3 shifts on 24 hr continuous production, but those are full time jobs, since when was the night shift part time?

Just like unemployment is bad because it’s people who want a job but haven’t got one, part time work can be bad if you want a full time job but can’t get one. Because this rise in part time work has coincided with the recession I doubt it reflects the choices of workers, so I agree it is probably another bad aspect of current economy, although better past time than no time.

Otherwise, I would generally applaud a rise in part time work – more leisure is a very sensible thing to buy with your wealth, and far too many jobs are full time or nothing. My guess is plenty of people would like to work 3 or 4 day weeks if it was an option.

Theoretically,

A 1% shift from full time to part time could be the equivalent of 310,000 jobs. Thus, not insignificant.

Even a 1% swing, its something in the region of c.155,000 jobs [i.e. half].

That we are ‘headed’ for a 2% swing over a 3 year period, is noteworthy.

As with all of these matters, it is the trend that is the biggest worry. Should this trend be sustained I doubt few would argue it is anything other that undesirable.

I love to work part-time.
The purpose of life is not to work.

Nb, didn’t we all praise Germany for cutting hours rather than jobs during it’s recession? Part of this data could be explained by firms cutting hours because demand is weak. Plus I seem to remember reading there has been a sharp rise in students working part time, if that’s what it is, no great diaster, I’m more worried about what happens to them after graduation.

Does anybody have data on what industries part time work is rising in?

@5

Indeed, demand is weak – that is one of the things that should worry us.

Erosion of pay and conditions is another though, and one which an increase in part time working hints at.

There’s no good news here.

#6

If weak demand is the explanation, firms could respond by making full time workers redundant or by moving them to part time. I’m not sure which is to be preferred, but I don’t see why the latter choice is a sign of anything being eroded, compared to the former. Would we be better with a lower proportion of part time work but higher unemployment?

I’m hearing soon employers won’t even have to pay minimum wage to teenagers for stacking shelves, they’ll be able to pay them £2.50ph as ‘apprentices’.

BB

Plus, things like tax credits are only available if you work enough hours.

@2 – By swapping childcare with someone else with a part-time job, perhaps?

Any truth in the figures that most new jobs being created are part time too? Also where do you get this data series from? (interested in the longer term trends)

#9

Could be … Good idea. In which case compared to working full time and having to pay childcare, working part time and buying childcare with your own time, via a swap, could leave you better off, on net. Not clear why this is a bad thing. I guess could be symptom of child care to wage ratio rising, which is the bad thing.

But are child care costs rising? Might expect child care fees to fall . . .would have thought supply up (unemployed looking to enter the trade) and demand down (fewer, less well paid parent wanting it)

I think you are essentially speaking about two different things. As you say, the increase in part time jobs is not always a bad thing and could be suggesting increasing labour market flexibility. Probably long term also tracks the increase in female participation in the labour market. Underemployment where people are working less hours than they would like is quite different. The ONS tries to track underemployment. The last article that they appear to have produced about underemployment is from last year.
http://www.statistics.gov.uk/elmr/02_10/downloads/ELMR_Feb10_Clancy.pdf

Some commentators have suggested that there is currently high levels of underemployment in the UK economy. Therefore, unemployment may not fall as fast as expected due to slack being initially taken up by workers increasing their hours.

” But even worse the Tescoization of our workforce means that big business would rather employ youngsters on the minimum wage on a part time basis than employ a mature adult on a full time basis. ”

If this was the case, would we not see low levels of youth unemployment and higher levels of unemployment in older groups? In fact, it is youth and low wage workers who are suffering the worst levels of unemployment.

Part time jobs are a joke. I was expected to be available every day of the week, from 8 til 7, and was only employed (and paid) for approx 20 hours.

There’s this growing belief that young people don’t need wages to live, or homes, or “real” jobs.

“My guess is plenty of people would like to work 3 or 4 day weeks if it was an option.”

I doubt it, cost of living means part time work aint going to feed your family, unless the part time work is well paid. TBH luis the assumption that part time and agency workers are chosing to do so through free choice is almost as bad as Tim’s idea that addiction has nothing to do with an alcoholics choosing to buy drink. My guess is that most people choose part time and agency work over claiming the dole, not over full time work. But it would be useful to have opinion polling evidence on this, rather than proceed with guess work.

“Does anybody have data on what industries part time work is rising in”

NOMIS is down at the moment, but the data for that should be there – I might take a look later.

About a month ago I did a similar analysis specifically for the south wales valleys (day job), and the data supports the conclusions of the OP. Full time jobs are declining, part time jobs are increasing, and this trend is worse in the more deprived areas. You’d have to be a particularly stupid person to argue this is the result of people in poor areas choosing to use their ‘wealth’ to buy leisure time, and nothing whatsoever to with the closure of factories and steelworks with formerly large workforces, and their replacement with……erm……….well a few adult education courses for retraining, and some call centre vacancies in Cardiff. How well that analysis translated at UK level I don’t know.

Planeshift

#2 I say I don’t think this reflects choices of workers, so we are in agreement.

Agreed you have to be relatively well paid to contemplate taking shorter week and lower pay, when I wrote I think plenty people might like that, I was thinking of middle class households with two earners. There are a few million of them, if that counts as plenty.

@14 – Which is why “Universal Benefit” is so worrying, the people doing these jobs are essentially going to be thrown back onto the dole, rather than claiming in-work benefits.

Also, Child Care fees have been kept high by child protection creating a high barrier to getting into that work. I’m not saying it’s an unnecessary barrier, but that’s been the effect.

There really is no problem with part-time work in a particular economic environment, I would suspect that the future will be a redistribution of work rather than wealth.
However, most part-time work is poorly paid, that’s why it generally attracts women with children, who are at school during most/all of their working hours. And working tax-credits only serve to skew the work available to certain people eg those with children, who will then accept low-paid, low status, unskilled jobs from organizations who exploit their position knowing it’s low pay but it’s better than the dole as@14 suggests.
@12 This also explains why it is the youth and older workers who are suffering the highest unemployment, no children no tax credits.

“But even worse the Tescoization of our workforce means that big business would rather employ youngsters on the minimum wage on a part time basis than employ a mature adult on a full time basis.”

The former are more willing to work family unfriendly hours. The 24 hour nature of the service sector means that the unrestrained growth of the part time job can be an attack on families. ”

Young people not being a part of families, then? It’s probably me misreading or an oversight by the author, but the OP seems to be written on the assumption that employment for middle-aged people is more important than employment for young people. Leading me to wonder what the young people have done to deserve being shafted.

Regarding young people…

1. Reverse EMA scrapping
2. Abolish tuition fees.
3. Reverse commodifcation of University
4. Give them proper skilled/vocational apprenticeships courses…

This would ease the downward pressure on wages…

@lee

Data source here, since the OP didn’t reference it:
http://www.statistics.gov.uk/statbase/TSDSeries1.asp

You want part time and time time employees (YCBE and YCBH I think).

The long term trend was from about 23-24% in the early 1990s to 25% after that recession, and it stayed at that level until this time.

If the long term pattern repeats it will reach 29% about 2030 !

How many of the people with part-time jobs aren’t working part-time but have two or even three part-time jobs, none of which have any – or any decent – pension or prospects, training/development, side benefits, trade union representation … ?

There is a huge difference between, say, Mr Secretary Hammond (who had several part-time jobs as an Opposition spokesperson all at tens of thousands pounds a year) and the part-time workers we are discussing here who receive the (pathetic) minimum wage for 40+ hours a week.

In whose interest is the move to increasing part-time jobs? Who is the mover – the worker or the capitalist?

Certainly reduce the average working week … but with no loss of income. Ah! Capitalist computer says “no”.

“But even worse the Tescoization of our workforce means that big business would rather employ youngsters on the minimum wage on a part time basis than employ a mature adult on a full time basis.”

I sorta doubt it really. The youth unemployment rate is much, much, higher than the mature adult unemployment rate.

I think that rather shows that employers (whether big business or not, Tesco or not) would actually rather hire a mature adult instead of having to pay a youngster the too high minimum wage.

BTW, the reason the min wage is too high? Because youth unemployment is higher than mature adult unemployment.

My entirely personal opinion is that Eoin is going to have to actually learn some stuff before his new think tank gets off the ground.

Like, y’kno, high youth unemployment rate relative to adult workers shows that people are *less* willing to hire the young, not more?

Timmy casually tosses a grenade into the bunker and steps back waiting on the explosion.

I remember the something in the budget regarding the shift in the threshold in family tax credits from 16 to 24 hours? Is this right?

So, if we are moving from full time to part time work and the balance being made via tax credits, doesn’t that mean more people becoming dependant of State handouts, rather than less?

Oh and what about NI contributions and pensions? How are we supposed to put into pensions i we are only earning a 100 quid or so a week?

Didn’t Cameron and IDS plead for the private sector to take up the slack and provide jobs? Does that mark the Tories as evil or just fucking stupid? The private sector do nothing other than feed their own greed.

Tim W @ 22

But Tim, you have been saying this for as long as I can remember; yet whenever the obvious question comes along, you appear to be reluctant to share it with us.

You live in one of the poorest Countries in Western Europe and has a de facto minimum wage much lower than ours. So they must be creating more jobs than us.

Tim, in the name of God.

WHAT ARE THESE JOBS?

When you look out of your window, what jobs are being done in Lisbon that are NOT being done in London? What is being done in Portugal that we could be doing here? What are the youth of Portugal doing that is being left undone in England?

What services are we missing, Tim? What does full employment in Portugal provide you with, but yet you cannot get in London?

“the reason the min wage is too high? Because youth unemployment is higher than mature adult unemployment.”

Uhhhhh, what?

My entirely personal opinion is that Worstall is going to have to actually learn to write properly, because it looks like that statement is the precise opposite of what he actually intended to say.

I work part time as a check out operator at a major supermarket. I work 15 hours a week and live in a small town in the north midlands. I also do a little writing for a local newspaper, a history walk and an occasional hour or so teaching for the WEA.. I have a postgraduate qualification. I have a partner who works 10 hours a week and a 7 year old daughter. We receive WTC. Its a struggle and there is about a £300 a month short full between what we earn and what we need. We have a discount card and I tend to shop for bargins or reduction. I have become expert in timing knowing when to go to the supermarket to get the bargins.

The cost of living has increased markedly over the last 12 months and the winter was so severe that a larger amount of money about £30 a week was going into the meter. Pre paid meters are far more expensive than direct debit. We simply don’t pay some things and I was caught out when a bailiff came round for non payment of council tax. I remain and optimist and I have just applied for a job within a charity that works on poverty issues and the writing is picking up.

I certainly would like more hours but the job market here is very tight. Two part time jobs with Argos in Leek attracted 200 applicants recently. I went for the job because it was the only thing going. I had been unemployed for several months and I was desperate to get off JSA. I don’t think I am the worst off at least I have the writing and the history walk to bring in the odd penny.

In terms of policy I would like some variant of a CI, the approach of the last Government through WTC is extremely complex.

@22 – And if it’s BOTH? That Youth full-time employment is startling low? I think someone needs to find out.

And given the youth minimum wage is lower than the adult one, that’s typical sweatshop Tory politics. Dumping wage costs for low-level workers onto the state rather than paying them out of private profits, then whining about the bloated state.

Bill Crawely @ 27

Welcome to Cameron’s Britian a fucking sweatshop economy run for the benefit of millionaires.

We simply don’t pay some things and I was caught out when a bailiff came round for non payment of council tax.

But, but, but weren’t we supposed to be taking the poor out of tax altogether? Surely the fiver or so you saved due to the Lib Dems instisting on upping the threshold must have more than covered the trival amount of money that council tax must cost? Even taking into account the mere 2.5% VAT increase to a fifth of the purchase price of goods must leave you a pretty penny over?

You surely are not suggesting that the biggest tax burden you have is NOT income tax? How can that be? Nick Clegg and David Cameron both pay lots of income tax and hardly any Council tax, so surely it is the same for the poor?

I mean, it is not like they would actualy have to think about something for two seconds?

I must keep repeating:

‘The Tories are merely midguided, not just greedy scum’.

“I think that rather shows that employers (whether big business or not, Tesco or not) would actually rather hire a mature adult instead of having to pay a youngster the too high minimum wage.”

As a pendant you’ll be happy to be corrected by me pointing out the min wage is lower for younger people than older people.

I think there are also other reasons for youth unemployment being higher; (1) young people have no or little work history, which even for crap jobs matters, (2) most will lack transport which means reliance on public transport/parents (hence no shift work), (3) the mere process of obtaining a job isn’t standing in the labour market waiting for employers to go shopping in the hope of picking up a bargain – it is through applications and being able to stand out in an interview*, which is something older people are more able to do through experience, (4) younger people have fewer networks to access for obtaining jobs – obviously this doesn’t apply if you went to public school, (5) many younger people have to juggle employment around education and training, which can also mean some types of working patterns are out, and potential employers may feel it could be a distraction (6) some employers think young people are going to be hungover and not work hard, and this attitude will be reflected in hiring decisions.

All of the above regularly get suggested in studies on youth unemployment, and always get ignored by economics bloggers more keen to focus on simplistic solutions such as “abolish the minimum wage” above actually trying to tackle these barriers, which generally involves spending public money in some form. I can only speculate that Tim doesn’t understand the above barriers because they haven’t been illustrated with squiggly lines in textbooks and words like “equilibrium” used liberally.

* – incidentally, 99% of books on job interview techniques clearly state that you should not discuss salary until an offer is made, and they caution against saying a low wage or trying to undercut others, as employers tend to view that as a negative and the person lacking assertiveness. This is advice that completely contradicts 99% of economics textbooks, which clearly state that people compete with each other in the labour market to drive prices down, hence if you want a job – you drop your price.

““Does anybody have data on what industries part time work is rising in”

NOMIS is down at the moment, but the data for that should be there – I might take a look later. ”

Luis,

I’ve had a look for this data on nomis. It exists, and you’ll find it through the business register and employment survey dataset. Unfortunately this is restricted information (i.e. you have to pay to get access) and I work for a small charity so don’t have that access. There are a couple of people on here who also use nomis, so maybe they have access?

As a disabled person who has completed a mainstream education up to university, I am capable of working and more than willing to work.

However, my disability means that I have regular medical appointments- so I am only able to take up a part time job. Are you suggesting that I, and the many other disabled people in my position, should not have part time jobs available to us?

Since my first job ended last year, I’ve been trying very hard to find another part time job- but every job that I would be physically able to do and that I am trained for is advertised as a full time position. Please tell me, if there has been such a rise in part time jobs, where I might find one.

@ Planeshift

Most of the economics just says price floors are distortionary. With the MW there are numerous variables that would change over time affecting different economies so there is no agreement how much a MW distorts. I think it is unlikely that the NMW is the only explanation for high youth unemployment. It is lefties who believe that wages are driven down. The dominant economics teaches that wages are sticky and do not fall enough when output falls resulting in unemployment. Moreover, it is known that employers pay more for labour than they need to for a very simple reason. Overpaying means you are more likely to employ and keep a good worker than a bad worker. Offer really low wages and only workers who know that is what their labour is worth will apply. Good workers who know they are worth more will not apply. Offer a higher wage and good and bad workers will apply. Therefore, the employer stands a better chance of choosing a good worker. That is why employers pay higher wages than they would need to if they were only interested in employing the cheapest labour. Just maybe, some people have an inflated sense of what they are actually worth to employers.

“However, my disability means that I have regular medical appointments- so I am only able to take up a part time job. Are you suggesting that I, and the many other disabled people in my position, should not have part time jobs available to us?”

That’s not even remotely close to what’s being said. The worry here is that the trend in terms of job growth, that the Tories are happy to crow about, is largely based around part time jobs. If full time work isn’t being created it’s indicative of how poorly our economy is recovering.

Also a rise in part time jobs doesn’t change the fact there are more people out there looking for work than there are jobs, so it also shouldn’t be a surprise that any jobs, part time or otherwise, that are remotely desirable would not be around for long.

“I think there are also other reasons for youth unemployment being higher; (1) young people have no or little work history, which even for crap jobs matters,”

Quite: which is why the impact of a minimum wage will be higher on young workers who have little or no employment history.

Come on guys, this isn’t anything new or radical. It’s straight mainstream economics. Common sense even.

“You live in one of the poorest Countries in Western Europe and has a de facto minimum wage much lower than ours.”

It’s not the absolute level of a minimum wage which matters. It’s the relative rate of it. What is the percentage of the minimum wage in relation to the average wage?

The minimum wage here is low in absolute terms compared to hte UK, yes. Around €550 a month. But as you say this is the poorest country in western Europe, making it quite a high minimum in relation to other wages.

I think Bertrand Russell would disagree.

@ 19 Éoin Clarke

Yes, but as you’re talking about “Tescoization” I assume that the perceived problem is too many young people getting low-skilled jobs that “should” go to older people. Admittedly the policies you suggest (all of them good, btw) would mean less young people in these jobs, but there would still be many of them working in Tesco and the like – some of whom would have dropped out of education regardless, others of whom would actually be working part time while at college/university.

Young people almost always make up a large proportion of a supermarket’s (or similar business’s) employee pool. I still don’t see why it’s a bad thing that these people have jobs, even if it’s at a middle-aged person’s expense.

Tim W @ 35

Quite: which is why the impact of a minimum wage will be higher on young workers who have little or no employment history.

Why is that though, Tim? Surely if I need a job doing, like stacking a shelf, it doesn’t really matter whether the person is older or younger, it only really matters that I can get my shelf stacked. If the set price of having that shelf stacked is £6.00 an hour then you pay it because six quid is nothing compared to the money you can generate from having a shelf full.

Why has the age of the person stacking that shelf got anything to do with it?

The minimum wage here is low in absolute terms compared to hte UK, yes. Around €550 a month. But as you say this is the poorest country in western Europe, making it quite a high minimum in relation to other wages.

Now, you seem to be contradicting yourself. You were saying that if wages are too high that causes unemployment, but now you are appearing to say that if the wages at the bottom of the labour is ‘too near’ the median, that is actually the cause of unemployment? How can that be?

If you live in a part of Europe where the minimum wage is half of that of the UK, then surely employment would be higher right across the board, no?

If their minimum wage is lower than ours, but still relatively high compared to the rest of the economy, that implies that the average wage is lower too, yes?

So, if wages across the spectrum are lower, much lower in Portugal then by your own logic employment MUST be higher to the point where there must be hardly any unemployment?

Is that the case in Portugal? If so, I again. What are the services you can by in your low wage economy that we in a high wage economy are missing?

Chaise @ 37

I still don’t see why it’s a bad thing that these people have jobs, even if it’s at a middle-aged person’s expense.

Chaise, the problem is that the entire programme of ‘welfare reform’ is predicated on the fact that there are ‘plenty of jobs out there’ and at every turn the evidence is contradicts that.

What used to happen was a guy who worked heavy industry for thirty years. He was made redundant, but had various ailments, say a tough of arthritis in his knee. Not a debilitating illness in itself, but enough to deter any sensible employer, given the labour market conditions. So the pragmatic choice would be offer him a way out. Give him an ‘honourable discharge’ to face his family. I often hear people say things like ‘the knee finally caught up with me’ or ‘the asthma got too hard’ etc.

Now that option is closed off to the newly redundant person, he has now to compete with young healthy workers (and immigrant labour) and face the ignominy of claiming unemployment benefit. The labour market is creaking under the strain, Chaise and cracks are appearing.

Now, you are off the opinion that the Tories are merely misguided here, but I can see no other answer than they are deliberately driving millions of people into poverty. I tyhink we may just agree to disagree on this one.

I fucking despise these cunt because of the damage they have done to my Country.

@ Jim

Agreed with most of that – but the problem there is the job market, not young people getting jobs per se. Society already bitches at young people for not working and now it seems we’re supposed to resent them when they do have jobs.

As for the Tories being misguided – if you mean the cabinet, then I’d go a bit further than that. I don’t think they’re deliberately making people unemployed for the hell of it, I just think that Cameron and most of his friends couldn’t give a shit either way whether people can earn a living (at least until it hits a certain critical mass and threatens their vote share).

“Why is that though, Tim? Surely if I need a job doing, like stacking a shelf, it doesn’t really matter whether the person is older or younger, it only really matters that I can get my shelf stacked. If the set price of having that shelf stacked is £6.00 an hour then you pay it because six quid is nothing compared to the money you can generate from having a shelf full.”

You’re assuming that the productivity of each worker is the same. Which, obviously, it isn’t. The real question is: “how much shelf can I get stacked for £6 an hour?”

At which point, as an employer, you’ve a problem. Because you don’t know how good any specific person is going to be at it. You need to use the various bits of infirmation you’ve got to make a guess at it. And one of those pieces of information you’ll have is “never had a job doing anything” and perhaps another CV saying “blindingly good shelf stacker, highly recommemnded, she only left us to move towns with her boyfriend”.

Seeing as the price you’ve got to pay for each is the same, that £6, well, which person is a rational employer going to hire?

“Now, you seem to be contradicting yourself. You were saying that if wages are too high that causes unemployment, but now you are appearing to say that if the wages at the bottom of the labour is ‘too near’ the median, that is actually the cause of unemployment? How can that be?”

We’re discussing two different things.

1) Will wages that are too high cause unemployment? Yes, of course they will. Any and every job where wages are higher than the value of the production from employing that person simply won’t exist.

2) The relationship of the minimum wage to the median wage is more subtle. Here we’re talking about the relative productivity of people. Our two mythical shelf stackers above for example. The larger the minimum wage is as a percentage of the median wage (research puts the break point where the effect becomes large at 40-50% of median wages) then the less opportunity the untrained and untried will have of getting a job. Because there’s no benefit to the employer of taking the risk that the untried might be a good ‘un.

Just try a thought experiment. If you could hire someone, anyone, for a £1 an hour, if they’re willing to accept it, then sure, you the employer of shelf stackers will happily give anyone a try out. Doesn’t really matter if they take a few days to get up to speed. You’ll try anyone and see if they do get up to speed. Hiring would be a matter of try it and see.

If you’ve got to pay 6 times that wage then you’ll be much more discriminating about who you’ll give a try to. It’s worth you spending £50 to sort through the applications, only take those who are likely to be good from the limited evidence you’ve got, because it’s going to cost you £150-£200 in three or four day’s wages to see who is actually good at the job.

“If you live in a part of Europe where the minimum wage is half of that of the UK, then surely employment would be higher right across the board, no?”

No. As above.

“So, if wages across the spectrum are lower, much lower in Portugal then by your own logic employment MUST be higher to the point where there must be hardly any unemployment?”

Nope, because, as above, it’s not wages that are the important thing. It’s productivity. How much output do I get per unit of wages paid?

And Portugal is indeed a poor country: one way of describing this is that labour is not very productive. No, really, the two statements are the same: highly productive labour equals rich country. Low productivity labour equals poor country.

Wages themselves are not the point. It’s wages in relation to production.

Chaise,

Thanks for the Fada É.

Young people should be given the time, space and financial support they need to educate themselves or develop vocational skills… A knowledge based economy is the aspiration I think.

Forgive me for asking this, for I may be wrong.

Is this the same Eoin Clarke who:

“and attended QUB for both my BA and MA (Irish Women’s History). I am currently in the first year of my PhD. Between my BA and MA I completed a PGCE in Nottingham and taught in the Midlands for two years.

Research Topic and Interests

My thesis title is ‘Women and Irish Republicanism, 1967-1987.’ My interests are twentieth-century political history in Ireland, in particular anti-state activity.”

??

The same Eoin Clarke who asks:

“What interests me the most from this graph is whether the UK wins from Free Trade? What are the virtues of Free Trade when we continually show an imbalance in the goods we export compared to that which we import? Should countries outside the EU with such a competitive advantage over our food and textiles producers be allowed such an unfettered lucrative consumption market or is it time for another age of Trade Protectionism to help our home grown industries? Also, is it ethical for the UK to be exporting depleting oil and gas resources when prices are rising so fast? ”

I ask because, well someone who has no education at all in economics, yes, from the mouth of the babe and the suckling we can indeed have useful questions.

I agree, Eoin Clarke might be a more common name that I think it is. These might be two entirely different people. But whichever…..can we get this nailed down? Is our Dr. Clarke the one who knows nothing of economics? Or another one?

@2. Luis enrique: “If you lack affordable childcare, how come you can afford a part time job but not a full time job?”

Come on, Luis, you know enough about real world economics. Bob can’t find a full time job but his partner Lucy has one. Bob looks after the family during the day and when Lucy comes home, he does a four hour shift wherever. If Bob did an eight hour shift, the complexities of tax benefits would leave them in wonderland.

Charlieman,

Well, in that scenario you’ve assumed Bob can only find part time work and made no reference the the price of childcare; I thought OP was saying rising childcare costs explained rise of part time work. In most cases I can’t quite see why if you can’t afford 35 hours of childcare when working 35 hours, you could afford say 16 hours of childcare when working 16 hours. See my point? Either you earn more per hour or day than childcare costs per hour or day, or you dont. working part time doesn’t make it any easier.

Hi Luis,

You are presuming that part time workers are paying for child care. In my example, part time workers (and partners) do not pay for child care because they organise their work/family time to avoid care payments. And there is still no guarantee that the family will earn enough to step onto the tax/benefit support line.

Luis: “Either you earn more per hour or day than childcare costs per hour or day, or you dont.” Acknowledged. But given the complexity of the UK tax/benefit system, how would you ever know?

@40 – But the Tories have made things worse for young people in one particular respect – abolishing the retirement age. While, in principle, it’s something which I favour, I would NOT have done this during an economic downturn. I’d of waited for the recovery, THEN done it. I urged Labour to do it during 2004-2007, for instance.

@41 – Explain Australia then. £10/hour minimum wage, doing very well.

@ 42

“Thanks for the Fada É.”

I have to put my cards on the table here and admit that I don’t get this reference. Google tells me that ” Fada É” is Portuguese for “fairy is”, but I’m guessing that isn’t it.

@ Éoin

Ignore me: got a bit more creative with Google and realised that it refers to accents on Irish words. You’re welcome!

charlieman,

No, you’re right. As childcare gets more expensive, households may try to organise their working lives to avoid having to pay it, which would entail more part time work.

Tim @ 41

You know, I have a fairly cynical view of the Right. I have expressed that view pretty often but I am told that I am just looking at the worst of people and finding it.
Well Tim, are we supposed to look at this statement and read anything other that what you have written?

You need to use the various bits of infirmation you’ve got to make a guess at it. And one of those pieces of information you’ll have is “never had a job doing anything” and perhaps another CV saying “blindingly good shelf stacker, highly recommemnded, she only left us to move towns with her boyfriend”.

Seeing as the price you’ve got to pay for each is the same, that £6, well, which person is a rational employer going to hire?

To me, given the above information, who gets hired, the answer is obvious. It doesn’t matter what the de fatco of price of labour is, the person who gets hired is the person who suits the profile best. Because, and here is the killer fact that you, an accomplished and published writer has ‘somehow’ managed to miss is this:

Tesco are not a benevolent trust, but a profit making enterprise. They seek to make as much profit as they can. They never take ‘a chance’ on anyone, no matter the price of labour. They hire who they believe (rightly or wrongly) to be the best person for the job, irrespective of the price of labour.

Now you have to explain at what point ‘Tesco’ or whoever stop being a hard nosed capitalised industry and become a benign enterprise more inclined to give unproven youngsters ‘a chance’. On you go, explain why, given a lower minimum wage you employ someone other than the best person for the job and employ someone who ‘society’ would deem it necessary to have a job?

The fact is that you cannot, Tim. I know it, you know it, I know you know it and I know you know that I know that you know that I know you know it too. So why the charade? Surely it would be easier if you admitted the truth and you are idealistically opposed to minimum wage because you simply cannot stand to see the poorest people in the Country get too much money?

And Portugal is indeed a poor country: one way of describing this is that labour is not very productive.

No, really, the two statements are the same: highly productive labour equals rich country. Low productivity labour equals poor country.

Not only is that fucking bullshit, but it is obvious bullshit because if it was true that ‘unproductive’ (i.e. lazy) labour equals a poor Country then how do you explain Poland an the rest of the Eastern Europe States?

These people are poor. These people are very poor in fact. Yet when these people move from very poor Countries they do not simply become more productive. They become the most productive people in the workforce, if half the reports are true. In fact these people become irreplaceable, again, if the reports are to believed.

What happens here? Why does a poor Polish or Estonian become able to earn anything between three and even ten times what they can earn coming here than they can earn in their homelands? They don’t become harder workers, do they? They are not ‘more productive’ once they magically leave the ex Communist circle, do they?

All that really happens is they move from a poorly performing economy to a richer performing economy and their labour becomes more valuable. So it is not the ‘people’ that is ‘unproductive’ it is the economy that is unproductive.

“Tesco are not a benevolent trust, but a profit making enterprise. They seek to make as much profit as they can. They never take ‘a chance’ on anyone,”

I myself am a hard nosed capitalist bastard. I do employ people myself. I have worked as a manager for other people too. And I’m afraid you’re simply wrong. Us capitalist bastards, you’re correct, we couldn’t give a shit about the people who work for us (note, rhetorical overblownness there). However, we are, by our very nature, by what we do, always taking a chance that we can produice something worth more than it costs us to produce it. That’s what we’re doing every day: taking chances.

So yes, of course, if we’re offered a cheap risk we’ll take it. Maybe that ex-addict really is off the needle? Who knows? If it costs me $100 to find out in wages, maybe I’ll try it? If it costs me $500, maybe I won’t?

That, by the way, is an example from my own experience: yes, we did (re) hire him and no, he wasn’t off the needle. But that’s what risks are about. For if he was off that needle then we’d have gained a very loayl employee for quite some time: until his stay in rehab was no longer relevant to any alternative employer.

I’ve also hired some straight out of jail. Same risks (he went in for embezzling from his former employer) and it worked out just absolutely wonderfully for all concerned.

Me, of course, I was only motivatde by how much I could make ouit of employing them. Which is why the risk had to be a low cost one.

“Not only is that fucking bullshit, but it is obvious bullshit because if it was true that ‘unproductive’ (i.e. lazy) labour equals a poor Country then how do you explain Poland an the rest of the Eastern Europe States?”

Please, go and look up the meaning of “productivity”. It has nothing at all to do with laziness.

The most important determinant is how much technology does the worker have to work with? This is very similar (although not exactly the same) as how much capital is being added to each unit of labour. The more technology, the more capital, the more productive the labour.

People in low productivity economies are those who are in low capital economies. That’s why you can take your Pole, stick them in a UK factory and he becomes more productive.

Blimey, anyone would think you’d never read Marx on capital accumulation or something.

And also, people who earn a good wage are more likely to want to hang on to it, and the way they do that is to work hard and be productive.
If low-paid work is not really much more than welfare benefits, then that job isn’t really that valuable to the person, unless, of course, they receive tax-credits, a system which sibsidizes wages.

@53. Tim Worstall: “That’s why you can take your Pole, stick them in a UK factory and he becomes more productive.”

Cough, nationality is irrelevant. Worker is just a worker

53
Why are you associating low-paid jobs with drug-users and criminals? If you really think that there is some kind of association between the two, it explains why you hold the views that you do.
I once had a male employer who was sexually inappropriate to me, that’s why I think that all male employers are sexual perverts.

“that’s why I think that all male employers are sexual perverts.”

I am, *obviously*.

“Cough, nationality is irrelevant. Worker is just a worker”

Sigh.

OK then, a worker using a shovel to build a dam is going to be less productive per hour of labour than that same worker with a JCB and a week’s training on using a JCB. The JCB is physical capital, the training is an increase in the worker’s human capital.

Happy now?

And when you move a worker from the low capital shovel environment to the high capital JCB plus training one the worker becomes more productive.

Tim W @ 53

Us capitalist bastards, you’re correct, we couldn’t give a shit about the people who work for us (note, rhetorical overblownness there). However, we are, by our very nature, by what we do

Tim. Do not get me wrong, I am not having a go here. I am not saying that Capitalism is wrong for not giving people a ‘chance’.

So yes, of course, if we’re offered a cheap risk we’ll take it. Maybe that ex-addict really is off the needle? Who knows? If it costs me $100 to find out in wages, maybe I’ll try it? If it costs me $500, maybe I won’t?

But why bother employing the ex junkiue for a hundred quid if you can get someone else on te same wages? Why would you ‘risk’ the former, if you could get the latter on the same wage? Lowering the minimum wage is not the answer, having a shortage of labour might make you want to risk it, but simply reducing the minimum wage will not because the even when the price of labour is lower employers will still employ the labour that fits their needs.

People in low productivity economies are those who are in low capital economies.

Yes, so when you said:

No, really, the two statements are the same: highly productive labour equals rich country. Low productivity labour equals poor country.

You meant that people who did not live in a high productive economy do not become rich, whereas people who happen to live in high productive economies do?

Then surely we (or rather they) need to determine what makes an economy high productive?

Why do Polish shelf stackers get five times as much in Britian than they do in Poland?

Is the minimum wage a factor here? If Poland had a minimum wage at the same rate as ours, what would happen? the price of labour would rise, with all the problems that we recognise, but demand in goods and services would surely rise too. That demand for goods would provide the opportunity for higher profits that in turn would cause a demand in labour that would mean that there would be a demand in the most productive labour? So the most productive labour would be able to command wages that are at least comparable to the most productive in Britian?

57. Tim Worstall:
“Cough, nationality is irrelevant. Worker is just a worker”

And you need to get a hang about irony.

@54 – Exactly, paying very low wages is dumping costs off onto the government to support the worker. That’s what they’re after.

Tim W ‘ 57

And when you move a worker from the low capital shovel environment to the high capital JCB plus training one the worker becomes more productive.

But is that true, though? Surely a plumber in Krakow is just as productive as one in Portsmouth, if he is using the same tools and material? He only becomes more productive (i.e. profitable) once his labour is transferred to an economy where he can charge fifty quid an hour?

He becomes ‘rich’ because his labour is worth more in one Country than another; there is nothing intrinsic in ‘plumbing’ as a hugely profitable trade per se. He is every bit as productive at home, but people in a low wage economy cannot provide him with the ability to become ‘rich’. He can only achieve that in an economy where the people are rich enough to provide him with enough money that he can be considered rich.

Which is why there is no reason for every plumber in Europe moving to the Sudan, despite the fact there is a shortage of plumbing and drinking water there.

The ‘demand’ for fresh water is huge, but for some reason, capitalism has failed to provide these people with the means to purchase the resources to purchase that water.

“I am not saying that Capitalism is wrong for not giving people a ‘chance’.”

How lovely. And I am saying that capitalism does give people a chance. As long as the risk is a cheap one. So, make the risks cheap and more people will get a chance.

This isn’t actually rocket science you know…..

“But why bother employing the ex junkiue for a hundred quid if you can get someone else on te same wages?”

Err, that was my point. If I can vary the wages I must pay in order to cater for those other risks, then I’m more likely to take those risks. If I have to pay the same wages to all, no matter what, then I will indeed leave the ex-junkie by the side of the road, won’t I?

“Then surely we (or rather they) need to determine what makes an economy high productive?”

Yup, we sure do.

There are economies where, despite everyone working as hard as they friggin’ can, the economy is poor, the people are poor. There are other econmies where, by any historical or current global standard, people are farting through silk for very little labour, effort.

We call the former “not market economies”, we call the latter “market economies”.

You, I, most of those who read this blog, we won the lottery ticket of life simply by being born Englishmen. Just because we were born in an area, an economy, which had been roughly “free market”, “capitalist” for a couple of centuries before we were born, we’re pig sick rich.

Yup, it’s great, I agree.

“Why do Polish shelf stackers get five times as much in Britian than they do in Poland? ”

Because as Paul Krugman says (you know, lefty, Keynesian, Nobel Laureate?) wages are not set by individual productivity. Average wages that is. Average wages are set by average productivity in that economy. If the productivity of every worker in Poland was the same as the productivity of every worker in the UK, then average wages in Poland and the UK would be the same.

Seriouosly, this is derived from ol’ Karl Marx himself. Capitalist bastards like me want to make profits. If the productivity of labour rises, then I, baby eating exploiter that I am, can make larger profits by stealing labour from other capitalists and employing them. In order to steal the labour I will offer them higher wages.

So, wages follow average productivity upwards. If even Karl Marx could get this, why cannot you?

“Is the minimum wage a factor here? If Poland had a minimum wage at the same rate as ours, what would happen?”

Most Poles would be out of a job. Because the average productivity of Polish labour in Poland is lower than the average productivity of labour in the UK.

This being proven by the fact that average Polish labout in the UK gets paid more than average Polish labout in Poland.

QED.

“But is that true, though? Surely a plumber in Krakow is just as productive as one in Portsmouth, if he is using the same tools and material?”

1) He ain’t. Using the same materials.

2) It’s average, not personal, productivity which determines average wages.

“Which is why there is no reason for every plumber in Europe moving to the Sudan, despite the fact there is a shortage of plumbing and drinking water there.

The ‘demand’ for fresh water is huge, but for some reason, capitalism has failed to provide these people with the means to purchase the resources to purchase that water.”

Err, no. It’s not capitalism which has led to people remaining poor enough that they’re not worth exploiting for profit by providing them with with water drinkable enough that it doesn’t kill the kiddies.

@62 – Sure, in a situation with a labour shortage. When there’s a labour surplus, however, it’s a great way to depress wages, which are already falling off, and the money in society shifting to unearned capital.

This is a paen for unearned income, no more and no less. Australia’s example shows what rot it is as well.

These debates on here all end up with the same basic misunderstanding about productivity. It has nothing to do with what you personally produce. Moreover, when you think about a wage in terms of somehow containing an embedded emotional value judgement on the person receiving the wage, then all kinds of wrong conclusions will be reached.

A Birmingham barber earns a higher wage for cutting hair than a barber in Beijing. There is a natural limit to how many haircuts a barber can produce, so a Birmingham barber is not any more productive than a Beijing barber. Moreover, the real wage of the Birmingham barber is higher than the real wage of a barber in Birmingham during the Victorian era. China does not lack money circulating in its economy, they are actually second only to the U.S. in terms of billionaires. There is actually too much money circulating in China, but that is a different story. Why the Birmingham barber earns more than the Beijing barber is not related to money. Therefore, there must be some other explanation unrelated to money or personal output that explains the wage differential. That explanation is the respective national productivity levels between the two economies.

As previously mentioned about too much money circulating in the Chinese economy. The Beijing barber will be currently seeing his nominal wage rise as he increases his prices. However, his real wage will stay the same as all other prices rise in tandem. The only way to raise the real wage is for national productivity to rise. The same thing would happen here or in Poland if the government just decreed wage rises unrelated to productivity. Moreover, if our national productivity level falls, our Birmingham barber would eventually find that he earned less in real terms even if he was cutting the same amount of hair. It would be a mystery to him at the micro personal level why he earned less for the same amount of work. However, his wage was never determined by his personal output in the first place.

“The only way to raise the real wage is for national productivity to rise”

Erm, no. You can also reduce the amount of money tried up in unearned capital. By making wages tied more heavily to personal labour, you start the work of rolling back the excessive power the capitalist markets have today, as well.

Free markets are good, but allowing non-productive capital to control them has lead to, as we’ve seen, money bleeding away from the people actually working.

Tim W @ 62

How lovely. And I am saying that capitalism does give people a chance. As long as the risk is a cheap one. So, make the risks cheap and more people will get a chance.

And six quid an hour isn’t cheap? Few people that run the likes of Tesco would get out of bed for six sodding quid, so don’t paint six an hour as a huge risk when plainly it is not. Tesco make a Billion in profit every year, they could take far more ‘risks’ than anyone else. They don’t though, they employ the most suitable candidaite for the job.

We all know that, Tim, but for some reason you pretend to have ‘forgotten’, why?

Err, that was my point…

No, your ‘point’ was that if we cut or abolish the minimum wage then the junkie becomes more attractive.

This is a fucking nonsense because if you cut the minimum wage for ‘junkies’ to three quid and hour then you are indeed pushing ‘everyone’ onto those wages, because everyone else will need to accept the de facto minimum wage or face being kicked out of the labour market as well.

Once you have destroyed the minimum wage then all you do is shove the whole recruitment process down a couple of levels. We have the same people competing for the same jobs and employers applying the same selection criteria. So once everyone has Dutch auctioned themselves, you will indeed be able to employ a ‘non’ junkie for the same wages as the junkie who has waived his right to the minimum wage?

Are you seriously telling me that is a far too difficult concept to grasp, Tim?

Just because we were born in an area, an economy, which had been roughly “free market”, “capitalist” for a couple of centuries before we were born, we’re pig sick rich.

Hang on though. We were never this rich or anywhere near it until after the Second World War. Until then, we were living largely hand to mouth for those centuries. It was only after the post war settlement(s) that we became pig sick rich.

If the productivity of every worker in Poland was the same as the productivity of every worker in the UK, then average wages in Poland and the UK would be the same

And yet we are told that we are a group of lazy, shiftless bastards who earn too much money from sitting on our unemployed arses and those of us who do manage to go out and earn the far too high minimum wage are equally as shiftless as the scroungers. Not only that, but the dead weight of government taxation and regulation has squeezed what little chance of profit out of the system?

Yet here we are far richer than all those Countries with none of the disadvanteges we have?

Everyone tell me that the Poles are harder workers than we are but they are dirt poor? We are told that Poles are better workers than us because they don’t have the welfare State we have, yet unemployment is higher there too? They have lower wages, yet there most productive clean our toliets?

Isn’t funny that these hard working people ar worse of, even though they have all the advanteges that the Right tell they have?

Most Poles would be out of a job. Because the average productivity of Polish labour in Poland is lower than the average productivity of labour in the UK.

Eh? Surely Poland has jobs that need doing, same as here? When we introduced a minimum wage, we didn’t stop doing jobs, we just got on with it. People do not have longer hair, they still get haircuts, shelves still get stacked and seciurty guards still patrol the area. And Toilets still get cleaned, at what price does it become worth it to pee into someone else’s turd?

“Hang on though. We were never this rich or anywhere near it until after the Second World War. Until then, we were living largely hand to mouth for those centuries. It was only after the post war settlement(s) that we became pig sick rich.”

No, not really. The average GDP per capita was, up until 1700 or so, $600 a year (in current dollars). Pretty stable, from Nineveh through Rome to feudalism and early modern.

By 1830 for the UK it was £1,700 ($2250) and 1900 over £4,000 ($6,000).

10 x historical average is pretty good isn’t it? Fair to call that pig sick rich?

“This is a fucking nonsense because if you cut the minimum wage for ‘junkies’ to three quid and hour then you are indeed pushing ‘everyone’ onto those wages, because everyone else will need to accept the de facto minimum wage or face being kicked out of the labour market as well.”

Please, go read your Marx again. 18 th Brumaire I think. It is the desire of capitalists to profit from employing labour which bids up wages. This happens when all labour is employed. Excellent, so, as soon as we’ve got all those people currently priced out of the job market into employment then wages will start to rise.

“When we introduced a minimum wage, we didn’t stop doing jobs, we just got on with it.”

Note those self-service checkouts proliferating at supermarkets. Raise the price of labour and it becomes profitable to automate certain jobs. The more you raise the price of labour the more jobs it is profitable to automate.

Tim W @ 67

Excellent, so, as soon as we’ve got all those people currently priced out of the job market into employment then wages will start to rise.

That is NEVER going to happen, though Tim, is it? The days of full employment are over and no government under any circumstances will let the market soak up every unemployed person in the Country. You know that as well as I do.

Note those self-service checkouts proliferating at supermarkets. Raise the price of labour and it becomes profitable to automate certain jobs. The more you raise the price of labour the more jobs it is profitable to automate.

Yes, but those self service tills are still manned. People are still there to supervise them.

Note those self-service checkouts proliferating at supermarkets. Raise the price of labour and it becomes profitable to automate certain jobs. The more you raise the price of labour the more jobs it is profitable to automate.

Yes, but those self service tills are still manned. People are still there to supervise them.

1 person per 8-12 tills, in supermarkets I visit.

70
And, as Marx would point-out, 7-12 workers would have no income to purchase the products. Mind you, Marx never calculated for tax-credits.

70
And, as Marx would point-out, 7-12 workers would have no income to purchase the products. Mind you, Marx never calculated for tax-credits.

Do you think Marx might point out that the supermarket’s income from those 7-12 workers would not cover what the supermarket has to pay them in wages?

@67 – Labour is only one of many factors behind automation, which proceeds apace in many cases even when labour is not a significant factor at all.

And GDP per capita does not take into account cost of living. If GDP has risen ten times, but cost of living twelve times…no, not rich at all. It also ignoring the increasing lock a very small minority has on the wealth of society, primarily due to unearned income and capital.

And again, please debunk Australia’s economic success, given their high minimum wage…

71
Marx would point-out that low wages and unemployment would eventually result in 1) monopoly and 2) the inability of consumers to ;purchase the goods which are produced, therefore, the inability of business to finance a further round of production. (Capitalism has to keep moving you see)
What we are seeing is thousands of businesses failing and probably, we haven’t seen the worst,
Under these circumstances many businesses would go bust because they could not afford to pay a market wage for labour (one which will ensure that consumption stays at a particular level)
Enter tax-credis, which allows employers to pay less on one hand but their employees ability to purchase isnt’t significantly affected. Of course, this cannot go on indefinitely, many will have to rely on the small welfare benefits which are paid to the unemployed. I wonder which part the state will choose to put its’ sticking plaster,

steveb, great, but we were talking about why the increased cost of labour might lead a supermarket to seek to have as few staff as possible to operate tills, notwithstanding the truth or falsity of your claim about what would “eventually” happen to society.