Missing wage rises give lie to picture of full employment : Guardian.

With non-UK nationals representing most of 300,000 rise in number employed, labour supply is helping keep lid on wages

'Staff wanted' sign
A restaurant window in Belfast. If we had true full employment, earnings would be rising, not falling. Photograph: Alamy

Britain has all the hallmarks of a full-employment economy. The employment rate is at a record level, unemployment is at its lowest in more than a decade, and the percentage of women working is at its highest since modern records began.

The one thing missing from this picture is an increase in wages. Full-employment economies are normally good for workers because they take advantage of labour shortages to strike better deals with employers.

Yet this is not happening in the UK. The latest figures from the Office for National Statistics show that employment was up in the final three months of 2016 but the rate of growth in earnings slipped back. The fact that the slowdown occurred while rising inflation was eroding the purchasing power of consumers makes the disparity between jobs and wages even more curious.

The obvious conclusion is that Britain is not actually operating at full employment because if it were, earnings would be rising, not falling. Although the unemployment rate is 4.8%, it can come down further without wage inflation starting to rise.

As the ONS has pointed out, the proportion of part-time workers who cannot find full-time jobs is markedly above the long-term average. The ONS thinks that this fact, along with the increase in the number of part-timers working in the economy, suggests there is a pool of labour that can be tapped by employers if they are looking to raise output.

There has also been a shift towards self-employment in the UK, a rise of almost 300,000 in the past two years. It is a reasonable assumption that many of the 4.8 million people working for themselves are not doing so voluntarily but because they cannot find better paid full-time work.

Employers have also been able to find workers from overseas. Between the final three months of 2015 and the final three months of 2016, the number of people employed rose by just over 300,000. Of those, 70,000 were UK nationals and 230,000 were non-UK nationals. The increase in the supply of labour has helped to keep the lid on wage increases.

Read More : The Guardian.


3 thoughts on “Missing wage rises give lie to picture of full employment : Guardian.

  1. jeffrey davies

    unemployment is at its lowest in more than a decade h a ha ha they stacking shelves at tescos they stacking shelves at salvation army even the ymca they all it taking a slave but its hiding away the unemployed billy liars have no morals no justice for those who get this treatment

    Liked by 1 person

  2. Loccie

    Zero hours contracts, multiple people all trying to do one job but apparently all in full time employment.

    People working multiple part time, low wage, short hour jobs but needing and wanting proper full time jobs.

    Pressure from the job center to be ‘self employed’ so those people magically vanish off the jobless total.

    People forced into ‘training’ those people magically vanish off the jobless total.

    Sanctions removing vast numbers from the jobless total.

    Large numbers of people who should qualify for benefits too tired or scared to claim those benefits because the safety net has become a net to trap and punish those who dare to try and claim.

    Anyone who believes any of this due to immigrants, poor, old, disabled, single parents has swallowed the poison fed to them by the evil people orchestrating this mess. Divide and conquer blame anyone but the real reason, they play on bestial emotions. The emotions of hate, hate those people lower than you but never look up. They have quadrillions, they could end this tomorrow they could even change the system so no one was ever disadvantaged again. The only answer can be this system is, by design, destructive.

    Their time is coming to an end.

    Liked by 1 person

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