‘Robots are not the only labour market worry’

Automation may pose a threat, but tackling low pay and productivity has to be an immediate priority, says Stephen Evans
15th August 2018, 5:46pm

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‘Robots are not the only labour market worry’

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Reports predicting a rise of the robots appear with increasing frequency. Estimates of the proportion of today’s jobs that may be automated over the coming decades range from 15 per cent to 30 per cent or more.

It’s certainly true that automation and other global economic change will have profound consequences for the jobs market. Of course, advances in technology will also bring new opportunities and create new jobs and industries. And people need to be able to access these new opportunities.

Particularly when combined with an aging population, all of this means an increased need for lifelong learning. This is an argument we at Learning and Work Institute have long made and a subject we’ll return to.

Weak growth in earnings

But today I want to focus on the here and now. Every month we produce a briefing on the latest labour market figures. It’s free - the August version is here and you can sign up for future updates if you wish.

With that gratuitous plug over, I think the latest labour market figures tell us something about the changed learning and skills challenge we face as a new academic year begins.

The basic headlines are that our employment rate of just over 75 per cent is at record levels, the unemployment rate of 4 per cent is at record lows, and growth in average earnings remains weak by historical standards. Indeed, the Resolution Foundation has shown that we’re on track for the worst decade for living standards growth since the Napoleonic Wars.

What does it mean for learning and skills?

Firstly, it means fewer people on the equivalent of unemployment benefits - traditionally those most actively seeking work and closest to the labour market. This helps to explain the fall in the number of benefit claimants taking part in further education: one in three learners was a benefit claimant in 2012-13; it’s now just one in four. There will always be a need for learning and skills support for those who are unemployed, but (at least until the next recession strikes) this isn’t where the largest numbers of people who need help are.

Secondly, it requires an increased focus on those further from the labour market and areas with the highest rates of worklessness. For example, people with health problems and disabilities have an employment rate 30 percentage points below that of non-disabled people. And there are more than twice as many disabled people on out-of-work benefits as people claiming unemployment-related benefits (in addition, many counted as unemployed also have disabilities and health conditions).

Many of those who have spent the longest out of work don’t have the skills needed for the jobs available. Engagement in learning can also help to build confidence and networks of support and contacts.

Work, health and learning

Learning and Work Institute is working with the government’s joint Work and Health Unit. Wouldn’t it be great to see a joint work, health and learning scheme? How can colleges and providers help to create this joined-up approach on a local basis, including with local and combined authorities and in devolution areas? Get this right and we increase the employment rate still further by giving everyone a fair chance to work.

Thirdly, it puts the spotlight on low pay and low productivity. We’ve increased the employment rate, but need to tackle low pay, help people progress, and boost productivity. Our productivity record is woeful. The average French worker can go home on Thursday evening having produced what it will take the average British worker the full week to produce. That limits economic growth, the scope for pay rises and the money to invest in public services.

Improvements in learning and skills can help (alongside improved infrastructure, innovation and competition). But we also need to improve leadership and management and make best use of the skills we have. This is all easier said than done, but it is a huge opportunity for the learning and skills sector working with employers.

So, yes, let’s look at the bigger, long-term picture, including the potential rise of the robots. But let’s also look at how the labour market has already changed and what that means for us all.

Stephen Evans is chief executive of the Learning and Work Institute

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