How to make a low wage economy


A friend recently applied for a job as an electrician, but when he was offered the post he was told he would only be paid the minimum wage. He was lucky – he had alternative work – but, as he pointed out, someone on the buroo would not have the choice. For the first three months you should be able to insist on looking for the type of job and level of pay you are used to, but after that you are fair game for the exploiters. In fact, as I told my friend, it gets even worse. Not long ago, we were contacted by a 63-year-old electrician from Glasgow with years of experience who had just been told to take a six-month community work placement where he would be working as an electrician for nothing more than his benefits. Someone on standard rate JSA working thirty hours a week is effectively working for £2.44 an hour. Joint Industry Board wage agreements are being tossed to the wind. Unemployment has always been used to drive down wages, but now our bastardised welfare state, rather than cutting across this, is actively encouraging a race to the bottom.

As we have said many times, mistreatment and exploitation of the unemployed also impacts on people in work. If employers can get free or cheap labour, they will be reluctant to create real jobs with decent rates of pay. Even if they try and pay decent wages they will be put at a competitive disadvantage. And the appalling treatment of people who are unemployed forces workers to accept worsening pay and conditions rather than complain and risk losing their job. If only in the interests of their own members, the trade unions need to be much more active in resisting the government’s attacks on the unemployed.

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