Britain should recognise the value of low-paid workers

Source: Financial Times, published on 27 November 2018

Much has been written about what the UK will give up if it leaves the EU next year. But it will also gain something: direct control over who can move to the country.

For better or worse, that is a powerful lever that could reshape the British labour market. So we need to have a nuanced debate now about what we value in the economy and how best to secure it. Otherwise, we will realise too late that the government has been making a dangerous miscalculation on our behalf: that all low-paid workers are low-skilled people of little worth.

The details of the UK’s post-Brexit immigration policy will be published next month but the outline is already clear. The government’s migration advisory committee has recommended that the UK become more open to higher-paid migrants, while putting a virtual stop to all immigration by the lower-paid, with the exception of seasonal field workers.

Alan Manning, the professor who chairs the committee, is well aware this would shake up the economy. Yes, sectors that expanded rapidly thanks to plentiful low-paid EU migrant labour would struggle, he has said, but “they’re not necessarily the parts of the UK economy that we want to be growing”.

For some low-paid, low-productivity sectors, Prof Manning has a point. Could the UK live with fewer cheap hand car-washes, which are staffed predominantly by migrant workers? Sure. Could it manage without so many chicken factories? Presumably Britain could import more processed food if it had to.

But what about social care workers, who look after elderly people in residential facilities or their own homes? They earn about the same as people who chop up chickens. But we don’t just need the ones already working here, we need more of them. In 2016, 18 per cent of the UK population was aged 65 and older; by 2036 this will have risen to 24 per cent. Providing care to the elderly is one of the jobs of the future. It cannot be offshored and it cannot be automated. Vacancy rates for social care workers are already more than double that of the average job and they are on the rise.

EU migrants account for a fairly small share of the social care workforce but their numbers have been growing quickly in recent years, helping to paper over the cracks of the recruitment crisis.

The IPPR think-tank has calculated that if the proposed new immigration policy was applied to the current workforce, almost 80 per cent of these migrant social care workers would be ineligible to work in the UK.

This is the problem with equating someone’s pay with their value. It does not account for the possibility that some people are paid less than they are worth to society. We all want to be cared for competently and compassionately when we are old. Yet these jobs have some of the economy’s worst salaries.

Not only are they badly paid but many carers in England who travel from house to house are not paid for their travel time, even though that is illegal. Almost 60 per cent of these overwhelmingly female workers are on zero-hour contracts, which do not guarantee any hours of employment, according to workforce data.

I have spoken to care workers who are forced to “cram call” six visits into an hour. Sometimes they have to take their children with them in the car because their employer changes their schedule at the last minute and they unable to arrange childcare. If they take a day off sick, they are penalised with drastically reduced hours when they return.

These are not bad jobs because migrant workers have driven down pay and conditions. Their numbers are too small to have had such an effect. They are bad jobs because social care providers bidding competitively for contracts from cash-strapped local authorities have stripped labour costs to the bone. And while choking off low-paid immigration would surely exacerbate the staffing crisis, maintaining freedom of movement for EU workers would not be enough on its own to resolve it.

The IPPR calculates that there will be a shortage of nearly 400,000 workers in adult social care by 2028 if the government ends low-paid immigration. If migration flows are allowed to continue on their recent trend, the shortage will still be about 350,000. The only way to resolve the problem is to increase the sector’s meagre funding.

Immigration is not the cause of the problems in social care, nor is it the solution. The sector is one of those caught in the crossfire of a Brexit debate that discounts the worth of some people’s work. The root of our difficulties is the persistent failure to recognise what is valuable — and to be willing to pay for it.

Copyright The Financial Times Limited 2018

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