From the TUC

Blaming the unemployed: it’s what they still believe

22 Nov 2010, by in Labour market

Iain Duncan Smith was back in Wales last week and was asked whether he stands by his “on your bus” comments. It seems that he does:

People who live on low incomes pay their taxes and get up early in the morning, travel half an hour or an hour to work to be able to get … work. They have a limited expectation – they want to see people out of work make the same effort.

The problem, however, is not whether unemployed people are making sufficient effort – when there aren’t enough jobs, the main effect of focusing on this would simply be to create a more energetic dole queue.

And there aren’t enough jobs. To illustrate this, I’ve used official data to look at the level of job vacancies and the number of unemployed people for every vacancy going back to 2001. This allows us to see the picture before the recession and compare it with what has happened since the Spring of 2008:

Number of vacancies and ratio of unemployed people to vacancies.

The normal picture, pre-recession, was 6 – 700,000 vacancies and 2½ – 3 unemployed people for each of them. That picture deteriorated rapidly in the recession; things improved to a moderate degree last Summer, but that stopped earlier this year – the number of vacancies has risen over 500,000 since January, and the ratio stopped improving at the same time.

Let’s be clear: there is no change in the behaviour of Jobseeker’s Allowance claimants that can explain these facts. Our problem is insufficient demand, not lazy people.

Of course, Mr Duncan Smith is right when he says that people who work hard and pay their taxes expect unemployed people to make an honest effort to get jobs. Unemployment benefits have always had rules that require this; unions support those rules. But it is dishonest and unfair to blame our unemployment problem on workers without jobs: they are the victims of unemployment, not the villains.

5 Responses to Blaming the unemployed: it’s what they still believe

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    Nov 22nd 2010, 2:53 pm

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  2. Alexis
    Nov 22nd 2010, 3:21 pm

    I would love to have an hour or so talking to IDS, being one of the “lazy unemployed” as he seems to be tarring all the unemployed. I say that ironically. I am unemployed, but certainly not lazy and I probably spend over 30 hours a week looking for a job, along with the rest of the waking (and indeed supposedly sleeping) hours worrying about where the next meal is coming from. I’m a professional and all the agents I speak to tell me the same thing – that there just arn’t the jobs there. It’s not as if I’m applying for jobs in my profession. I’m applying for anything and everything out there, but to be frank, unless you don’t pay rent/mortgage/CT, who can live on NMW? I’m not the only one. So you’re getting a situation where there’s a glut of over-qualified people going for the same jobs as people who would normally go for them. I’m told that in my field, there’s 80-100 applicants per vacancy and that includes people who are willing, like myself, to relocate hundreds of miles. Get real IDS. It isn’t the unemployed who got the country into this economic mess. Look a little closer to home. And it’s the government who isn’t supporting those who could regenerate and create growth.

  3. Tokyo Gaijin
    Nov 23rd 2010, 12:23 am

    I’m sure there are many genuine people like you who are actively looking for work and agree it’s not right that everybody gets tarred by the same brush.
    Why is it that millions of non UK born people can find work in the UK ? and that 200,000 more have managed to do so in the past year ? “The number of non-UK born people in employment (not seasonally adjusted) was 3.89 million, up 204,000 from a year earlier.” from the November 2010 ONS Labour Market Statistics.

  4. Alexis
    Nov 23rd 2010, 7:23 am

    Tokyo, I’d be interested to see in which sectors these people were working, in which tax brackets and the percentage on NMW, not to mention whether the majority are single or have a family etc who are still at “home”. What is the seasonally adjusted figure? I’d also be interested to see how many stay for a period of longer than one year.

    Then, of course, there’s the question of illegal immigrant labour, but I suppose that is not taken into the equation. But that is digressing. The simple fact is this – this country is one of the, if not the most expensive countries to live and work in in Europe. Wages on the whole tend not to reflect this and that is no fault of the SMEs, or small firms who would like to take on more staff at a decent rate of pay. NMW is below the breadline. Do you think that, after deductions, you could live on it Tokyo?

  5. Tokyo Gaijin
    Nov 24th 2010, 6:42 am

    Does it matter what jobs these millions of people are doing ? Surely the point is that they are doing them whilst at the same time millions of Britons are unemployed. What that tells me is that either 1. Britons are unqualified to do these jobs, in my opinion this accounts for a small fraction of the total, or 2. Britons are unwilling to do these jobs, this I believe is far more likely. At least part of the reason for this is that there is no incentive to work. Take my local area in Hampshire. A single unemployed 25 year old gets £132.33 per week in LHA plus £65.45 per week JSA which comes to ~£10,300 per year, in addition ~£780 worth of council tax benefit would be paid making a total of ~£11,000 per year. If the same person were to go to work in a minimum wage job they’d make ~£12,300 gross, plus working tax credit and housing benefit of ~£3,800 minus tax and NI of ~£2,000 leaving a net income of ~£14,100. So going to work makes you better off by ~£3,100 per year or <£60 per week. In other words you'd effectively be working for £1.50 per hour. In this situation people who choose to live off benefits are making a pretty rational decision that's right for them but wrong for those who do work and pay taxes. Of course each case is different but it seems fair to assume each unemployed person costs at least £10,000 per year so filling half of those jobs currently taken by foreign born workers would save £19,000,000,000 per year, about 13% of the budget deficit.
    My opinion is that increasing the minimum wage or placing a cap on immigration would penalise the manjority through higher prices of goods and services for the benefit of a minority. So the welfare reforms proosed by IDS is a definite step in the right direction and a good compromise that balances the needs of most people.