From the TUC

Sajid Javid on Question Time: yet more labour market spin

20 Mar 2015, by in Economics

Last night’s BBC Question Time (20 minutes into the iPlayer recording) featured Sajid Javid MP, a member of Cameron’s cabinet, defiantly claim that 80 per cent of the jobs created in the past 5 years have been both full time and high-skilled in response to an audience member who was rightly concerned about recent employment trends. Here’s how the exchange went (I’ve lightly edited it for house style):

 Audience member: You alluded to the fact that unemployment has come down, and the Chancellor was pretty delighted to be able to say that, but if you actually look at the tax take in terms of income tax and national insurance contributions you’ll see that the same amount of work is being done but it’s spread over more people; and that’s zero-hours contracts, low paid jobs, part-time work. The actual full unemployment crisis has not been fixed and that’s why there’s a cost of living crisis, that’s why living standards haven’t been raised to back to the standard we expected[…]

Sajid Javid MP: Well I’m sorry sir, I have to point out the facts. The jobs created, 2 million jobs created over the last 5 years, 80 per cent of those jobs are full time jobs. That proportion – 80 per cent full time 20 per cent part time – hasn’t changed in the last 10 years. The proportion is roughly what it has always been. Zero-hours contracts represent 2 per cent of the entire workforce. 2 per cent. And most of those people would say they want the flexibility of those types of jobs. [….] Of the jobs created, 80 per cent are high-skilled occupation jobs that pay a good salary. That’s a fact.

There we have it! I’m sure the audience member was truly relieved to hear these facts.

Unfortunately Mr Javid, who seems to be under the same spell as his colleague George Osborne, was delivering yet more pre-election political spin on the labour market.

According to the latest ONS data on the labour market, 71.7 per cent of the growth over the past 5 years (from Nov 2009-Jan 2010 to Nov 2014-Jan 2015) came from full-time employment. As my colleague Emily Pfefer noted earlier this week, it’s not really OK to round 72 up to the second-nearest 10. 

Even if the audience member could forgive this mathematical malfunction, he also ought to be told that this full-time employment figure misleadingly includes the self-employed; and increases here are widely understood to be indicative of underemployment. This is supported by the low and falling pay for this group of workers, with average weekly earnings for the self-employed down 20 per cent since 2006-7. In addition, we know from the Office of Budget Responsibility that “the limited amount of information on self employment incomes suggests that the growth in self-employment has been concentrated at the lower end of the income distribution” (December EFO, para 4.51).

Full-time employees have in fact comprised 55 per cent of the growth in jobs over the past 5 years. The rest: part-time workers and the self employed. This is certainly not the norm – and moreover, Javid’s claim that the proportion of the labour force has always been 80:20 full-time:part-time is also untrue. Looking back to 2005, the timeframe he references, full time employment (including self-employment) peaked in 2006 at 74.9 per cent, consistently fell until 2013 and has recovered a little since the crash.  

FTPT Employee Share
Source: TUC analysis of LFS

A similar picture is seen for the full-time employee share of employment, which is a better measure of quality work (even though it may still be distorted by zero-hours contracts). Had the full-time employee share of employment been stable at 64.7 per cent (where it was ten years ago), an extra 640,000 people would be in full-time employee jobs today.

 Employee share

Source: TUC analysis of LFS

On the high skilled jobs point, the reality is even further from the ‘sunny’ picture Mr Javid painted yesterday evening.

Data for the past five years on the skill-level of jobs are only up-to-date to Q4 2014, so to go back over this period would include figures from the prior Labour government. High-skilled jobs are referenced in the Budget as “managers, directors & senior officials, professional occupations and associate professional & technical occupations”.

Here’s how high skilled jobs have contributed to the increase in employment over time according to various definitions of “the past five years” and other time frames Mr Javid might have been referencing:

Source: TUC analysis of LFS

*Not seasonally adjusted

So, to look at (the various permutations of) the full 5 years Mr. Javid mentions and include figures from the previous government, just less than a third of the new jobs were in high-skilled occupations. To look over the past 4 years and discount the performance of the past government, the contribution slips 6 percentage points to 25 per cent.

Perhaps Mr Javid got his dates mixed up – perhaps he was thinking of the last year in office, which has seen an uptick in employment growth in full-time jobs? It doesn’t look good in that timeframe either – high-skilled jobs contributed to 26 per cent of the annual growth in employment from Q4 2013 – Q4 2014.

 It’s one thing to cook the books, but Tory rhetoric on the labour market this week has been no better than a dog’s dinner.

2 Responses to Sajid Javid on Question Time: yet more labour market spin

  1. Bryan Sadler
    Apr 17th 2015, 3:26 pm

    Brilliant stuff. Is it OK for me to make positive comments on Facebook and use your diagrams in support ?

  2. Silkie Cragg

    Apr 18th 2015, 9:26 am

    Hi Bryan – of course – if you could include a link to this blog that would be great. Glad you found the post useful.