The UK’s “low-pay culture” leaves as many as one in every four workers “permanently” stuck on a low salary, from which they have “little chance of escape”, a new report warns.
The study, conducted by the Social Mobility Commission, an advisory non-departmental public body, also revealed that almost half (48%) of the country’s workforce fluctuated in and out of low-paying jobs over the past decade.
The report - titled “The great escape” - also showed that just one in six low-salary workers managed to permanently move to better-paid jobs during that frame.
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People in low-paying jobs have seen their hourly wages rise by just 40p in real terms, on average, over the past ten years, compared with a £4.83 pay rise for those who have permanently “escaped”.
Older people were least likely to be able to escape low-paying jobs. Different geographic areas also showed differing results, with Scottish workers most likely to escape, and those in the Northeast of England least likely.
Former Labour health secretary Alan Milburn, who chairs the commission, said: “Britain has an endemic low pay problem. While record numbers of people are in employment, too many jobs are low skill and low paid.”
Young women juggling work with childcare responsibilities are especially likely to end up in poorly paid jobs, he added. “Millions of workers - particularly women - are being trapped in low pay with little chance of escape,” Milburn said. “The consequences for social mobility are dire.
“Britain’s flexible workforce gives us global economic advantage, but a two-tier labour market is now exacting too high a social price. A new approach is needed to break the vicious cycle where low skills lead to low pay in low-quality jobs. Welfare policy should focus on moving people from low pay to living pay.”
Theresa May’s government has defended itself against the claim that inequality has widened in the last decade by referring to the Gini coefficient; an internationally recognised measure of income inequality that has remained fairly constant in the UK in recent years.
But, as The Guardian points out, the Gini coefficient also includes pensioners and people on benefits, while the commission’s research focuses on those in active employment.
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