Tag Archives: Inequality

Work in Low Pay, No Pay Britain

In this latest Thinking Allowed podcast on ‘Low pay, no pay’ Britain Laurie Taylor talks to the sociologist, Tracy Shildrick, about her prize winning study of individuals and families who are living in or near poverty. The research was conducted in Teesside, North East England, and focuses on the men and women who’ve fallen out of old working class communities and must now cope with drastically reduced opportunities for standard employment. To my mind, this is a good in-dept illustration of what life is really like for a section of the Precariat (although Shildrick would be more cautious).

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The research is based on the book (published in 2012) – Poverty and insecurity Life in low-pay, no-pay Britain by Tracy Shildrick

This book explores how men and women get by in times and places where opportunities for standard employment have drastically reduced and where people exist without predictability or security in their lives, the book shows how poverty and insecurity have now become the defining features of working life for many.

Work may be ‘the best route out of poverty’ sometimes but for many people getting a job can be just a turn in the cycle of recurrent poverty – and of long-term churning between low-skilled ‘poor work’ and unemployment.

Based on unique qualitative, life-history research with a ‘hard-to-reach group’ of younger and older people, men and women this research challenges long-standing and dominant myths about ‘the workless’ and ‘the poor’, by exploring close-up the lived realities of life in low-pay, no-pay Britain.

Below is a summary of the main points of the podcast

  • The low-pay no-pay cycle is much more common than long-term unemployment. Most people intreviewed were committed to work, even though the jobs they did were not ‘comfortable’ jobs. This was one of their most consistent findings…. which in part explains why these people go back time and time again. This of course is the opposite to what we here in the media about people ‘languishing on benefits’.
  • It is not a guarantee that taking up employment will mean an individual is going to better off than on benefits. Most people were ashamed at having to claim benefits.
  • Jobs typically did not last long enough to take workers away from poverty.
  • In work-poverty is – 66% of poverty live in households were at least one person is in-work.
  • The types of work include factory jobs, bars, customer service, often run through agencies.
  • For the people interviewed these type of jobs are not stepping stones to something better – they get one foot on the rung of the ladder, get knocked off, and have to climb back on again.
  • Shildrick is not convinced that the term ‘Precariat’ is accurate enough to describe adequately the experience of all people who are sometimes put into this category. She argues that the experiences of the people she interviewed are different to those of a graduate working for a few years in similar jobs (although the people she interviewed do seem to fit into the definition of the Precariat used by the GBCS below)
  • In response to the idea that better training is the solution to helping people in these jobs, Shildrick suggests we need to look at the bigger picture – society needs these jobs – we need to think ahout how to reward them more appropriately.

Shildrick suggests that it is ultimately employers who have the power to help people out of this cycle. Unfortunately, the trend seems to be of employers being increasingly inflexible while demanding that employees be more flexible.

Links –

1. This seems to be a good in-dept illustration of what life is really like for a section of the Precariat

2. Also a nice illustration of the effects of living in liquid-modernity – The reality is actually bleaker for them than the above research might suggest – As Zygmunt Bauman reminds us (in Liquid Modernity)- ‘The bottom category are the easeist to replace, and  now they are disposabe and so that there is no point in entering into long term commitments with their work colleagues…..  this is a natural response to a flexibilised labour market. This leads to a decline in moral, as those who are left after one round of downsizing wait for the next blow of the axe.

Winner of the British Academy Peter Townsend Prize for 2013 How do men and women get by in times and places where opportunities for standard employment have drastically reduced? Are we witnessing the growth of a new class, the ‘Precariat’, where people exist without predictability or security in their lives? What effects do flexible and insecure forms of work have on material and psychological well-being? This book is the first of its kind to examine the relationship between social exclusion, poverty and the labour market. It challenges long-standing and dominant myths about ‘the workless’ and ‘the poor’, by exploring close-up the lived realities of life in low-pay, no-pay Britain. Work may be ‘the best route out of poverty’ sometimes but for many people getting a job can be just a turn in the cycle of recurrent poverty – and of long-term churning between low-skilled ‘poor work’ and unemployment. Based on unique qualitative, life-history research with a ‘hard-to-reach group’ of younger and older people, men and women, the book shows how poverty and insecurity have now become the defining features of working life for many. – See more at: http://www.policypress.co.uk/display.asp?K=9781847429100#sthash.8EnqVw5J.dpuf
Winner of the British Academy Peter Townsend Prize for 2013 How do men and women get by in times and places where opportunities for standard employment have drastically reduced? Are we witnessing the growth of a new class, the ‘Precariat’, where people exist without predictability or security in their lives? What effects do flexible and insecure forms of work have on material and psychological well-being? This book is the first of its kind to examine the relationship between social exclusion, poverty and the labour market. It challenges long-standing and dominant myths about ‘the workless’ and ‘the poor’, by exploring close-up the lived realities of life in low-pay, no-pay Britain. Work may be ‘the best route out of poverty’ sometimes but for many people getting a job can be just a turn in the cycle of recurrent poverty – and of long-term churning between low-skilled ‘poor work’ and unemployment. Based on unique qualitative, life-history research with a ‘hard-to-reach group’ of younger and older people, men and women, the book shows how poverty and insecurity have now become the defining features of working life for many. – See more at: http://www.policypress.co.uk/display.asp?K=9781847429100#sthash.8EnqVw5J.dpuf
Winner of the British Academy Peter Townsend Prize for 2013 How do men and women get by in times and places where opportunities for standard employment have drastically reduced? Are we witnessing the growth of a new class, the ‘Precariat’, where people exist without predictability or security in their lives? What effects do flexible and insecure forms of work have on material and psychological well-being? This book is the first of its kind to examine the relationship between social exclusion, poverty and the labour market. It challenges long-standing and dominant myths about ‘the workless’ and ‘the poor’, by exploring close-up the lived realities of life in low-pay, no-pay Britain. Work may be ‘the best route out of poverty’ sometimes but for many people getting a job can be just a turn in the cycle of recurrent poverty – and of long-term churning between low-skilled ‘poor work’ and unemployment. Based on unique qualitative, life-history research with a ‘hard-to-reach group’ of younger and older people, men and women, the book shows how poverty and insecurity have now become the defining features of working life for many. – See more at: http://www.policypress.co.uk/display.asp?K=9781847429100#sthash.8EnqVw5J.dpuf

The World Wealth Report 2013

 

The World Wealth Report reports on trends in the wealth of HNWIs – Or High Net Wealth Individuals. These are individuals with $1million or more in investable assets. You have to sign up to be able to download the report, but its free. (Thankyee for the crust kind sirs, doffs cap…) 

Between 2011-12, the richest 12 million people in the world gained an extra 4.2 trillion dollars of wealth between them – Their total wealth is now $46.2 billion, up from $42 billion in 2011. Thats a tidy $350 000 each extra on average, and according to the predictions below that trend is set to continue…

wealth1

Of course it gets bleaker… the averages above disguise the fact that the richest Ultra High Net Wealth Individuals increased their overal wealth more than the mere ‘millionnaires next door’… the proportional increases may well be the same, but of course a 10% gain on $50 million means you gain more than if you’d gained 10% on a mere $1 million.

wealth4

 

And bleaker… The richest 12 million may have got 10% richer on average, but this is on the back of a mere 2.2% GDP growth rate, so their wealth is growing nearly five times the rate of real global wealth (although somehow I’m sure that’s not a fair comparison?!)

wealth5

 

And even bleaker… according to the World Bank’s GNI data (not the same as wealth I know) –  GNI only increased from around 70 to 71.4 trillion dollars, which is less than 1%, so most of this wealth increse doesn’t seem to be rooted in the production of tangible goods and services.

No doubt there are different ways of interpreting what this data actually means, comments welcome!

 

In case you prefer a word-based summary – the 2013 report notes the following…

  • Between 2011 to 2012 The world’s HNWI population increased by 9.2% to reach 12.0 million, after remaining flat in 2011.
  • In the same period, The aggregate investable wealth increased 10.0% to US$46.2 trillion, after declining slightly in 2011.
  • ƒHNWI wealth in 2012 represented a new level of strength, going well past the historical high of US$42.7 trillion set in 2010.
  • Relatively stronger growth rates in higher wealth bands4 (US$5 million or more) led the growth of overall investable wealth globally.
  • All of this is despite a decline in the rate of world GDP growth to 2.2% last year.

 

 

Social Class Inequality Visualisations

I had my classes exploring one of my ‘favourite’ topics today – The extent of and explanations for inequalities in life chances by social class, gender and ethnicity – Here a few visual updates and links which highlight the extent of class inequality in the UK today…

1. In Education… 3 year olds from the richest fifth of households are twice as likely to be ‘school ready’ than 3 year olds from the poorest fifth of households

education

2, by health – This is a nice, if dated article which reminds us that Based on 2007-2009 mortality rates, a man aged 65 could expect to live another 17.6 years and a woman aged 65 another 20.2 years. This graphic demonstrates that men and women from routine manual backgrounds are twice as likely to die before the age of 64 than those from professional backgrounds(my title is clearer than that in the picture!)

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3. The chances of being a victim of violent crime (available from the ONS and the Home Office Annual crime stats reports)

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4. Births outside of wedlock (not that I think the decline in marriage is a bad thing!, unlike the author of the post where I got the info!

The chart below shows the proportion of kids who are born outside marriage by social class in Britain. Its quite a short period of time, but you get the general idea. At the top, things haven’t changed much. At the bottom, having children inside marriage is not the norm, and increasingly rare.

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More Sources to follow…

 

Inequality updates – UK Focus

While the recent recession and ‘recovery’ have meant economic hardship and uncertainty for the majority, the VERY rich have got relatively richer.

Before looking at things sociologically (looking at the bigger picture) I’d just llike to say THANKS AGAIN TO THE BBC* for another excellent example of narrow-reporting which fosters false consciousness – This item reminds us that the levels of income inequality have fallen – if we compare the top fifth with the bottom fith of households over the last year.

HOWEVER…. If we look at how the incomes of the top one percent and top ten percent compare to other slices of the population further down the social-class spectrum, a picture of INCREASING INCOME INEQUALITY IN THE UK EMERGES

This article from The Guardian summarises the situation –

The super-rich – the top 1% of earners – now pocket 10p in every pound of income paid in Britain, while the poorest half of the population take home only 18p of every pound between them, according to a report published this week by the Resolution Foundation thinktank, which reveals the widening gap between those at the very top and the rest of society.

Inequality has grown sharply over the past 15 years, according to Resolution’s analysis: the top 1% of earners have seen their slice of the pie increase from 7% in the mid-1990s to 10% today, while the bottom half have seen their share drop from 19% to 18%.

This post from the Guerilla Policy Network offers a nice summary of the lates UN Human Development Report which highlights the following facts –

  • The UK’s poorest 40% share in just 14.6% of the national wealth – the only country performing worse was Russia (96)
  • The richest 20% have incomes more than ten times as high as the bottom 20%, this is the same as Nigeria, and worse than Ghana and the Ivory Coast, and twice as bad as Sri Lanka and Ethiopia (96)
  • As inequality in the UK has risen, intergenerational mobility (children ‘doing better’ than their parents) has also declined (2013 p36)
  • The majority of working people have had little or no wage increases in recent decades, while the top earners have seen substantial increases (2013 p22)

For those of you who prefer Infographics to illustrate inequality, here is one from the equality trust (love their work – ‘gis a job!)

income-inequality-uk-2

*(Seriously, thankyou, without you, BBC, teaching concepts such as ideological control, agenda setting, and false consciousness is just so easy.)

Rapidly Developing Countries – Set to become rich countries full of poor people?

Nice article here outlining some arguments for the continued relevance of dependency theory – ending on a particular pertinent prophecy by Joseph Stiglitz – that our world is set to become one of more rich countries full of poor people – but is this true?

Looking at the world’s 10 fastest growing economies there seems to be mixed evidence-

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If we consider the GINI inequality rankings for each of these countries, which are as follows – there is mixed evidence

Brazil scores 54 – is no. 13 in the inequality league table, and by far the largest population country up that high – so Stiglitz theory seems correct here…

China scores 47 and so has relatively high inequality, possibly reflecting the differences between the huge wealth in the East and rural poverty in the West. Then again, does this matter for development because China has a very similar level of inequality to the USA ( not that that’s a good thing of course!)

Russia scoring 40 is in mid table obscurity – so no comment for now

India scoring 33 – has low inequality, making it more equal than Britain, then again it is the poorest in terms of current GNP per capita so these levels of inequality might just reflect the fact that there are masses of poor people. Given the rapid increase in billionaires recently i don’t hold out much hope for india staying low in the inequality stakes!

Ten Indicators of Gender Inequality in the UK 2012

OK So accuse me of selection bias… but here are 10 indicators of inequality in the UK by gender… Mainly focusing on work, politics and the media 

Looking at ‘positions of privilege’ women account for…

  1. 26% of News Journalists (2011) (3% of sports journalists!)
  2. 22% of Members of Parliament. Although admittedly numbers have more than doubled in the last 20 years.
  3. 23% of judges
  4. 16% of members of the cabinet
  5. 4.9% of directors of the FTSE 250 companies

Looking at ‘indicators of disadvantage’…

  1. 65% of the Tory Cuts to the public sector will be born by women
  2. 70% of people on the minimum wage are women
  3. 75% part-time workers are women
  4. 90% of Single Parents are women
  5. On top of all this, women earn only 85% of men (more usually expressed as a  gender pay gap of 14.9%)

Find out More

Also look out for an infographic I intend to to knock up on this topic (exciting I know!) 

 

Whither my vain search for nice graphs on UK wealth statistics

… Hopefully in a response that’ll land me with a link to some nice.. err.. wealth distrbution graphs or pie charts…

I’ve spent the last 5 years or so looking for some nice up to date visual resources on wealth distribution in modern Britain, to update the pie chars I’ve gto from about 2006 – with really limited success – is it just me or is it just impossible to find easily accessible information on wealth stats in the UK… Or are pie charts on wealth distribution just not 2012? (or 2007-11 for that matter?)

You might think that searching around the government’s own Office for National Statistics, you’d get some info about wealth, but no, this gets  you nowhere – not if you want any data from the last few years at least.

Out of desperation you might try typing in any combination of ‘wealth distribution 2010 or 11 and UK or Britain’ to google but, with the exception of the excellent report mentioned below from 2010,  you simply get directed to old stats or stats on income distribution – so this is hopeless.  

So  unless I’m missing something – it’s actually very difficult to get reliable, up to date info on Wealth Stats – but here’s five, well four, sources of info.. no nice pie charts tho’!

Firstly there is this recent government report The most comprehensive recent source on wealth distribution seems to be this report from 2010 ‘An anatomy of economic inequality in the UK’ (summarised in this Guardian Article) which found that by retirement age the top 10%, led by higher professionals, had amassed wealth of £853 000,  while the bottom 10% of households, led by routine manual workers, had amassed less than £8,000. This means – and this is my headline figure – the richest 10% are 100 times richer than the bottom 10%

For an even starker comparison – the top 1% had, by the time they reached retirement age,  accrued an average wealth of £2.6 million, making them more than 300 times richer than the bottom 10%

The report measured wealth inequalities by looking at total assets accrued over the course of a lifetime – the findings were hardly surprising – the older you are the richer you are, the poorer your parents were, the less likely you were to accrue wealth and so on…. but it is informative to have such data to hand.

The body responsible for the above report is worth keeping an eye on – The Centre for Analaysis of Social Exclusion for updates on wealth issues.

Secondly, the most recent data from the Office for National Statistics (summarised in a blog which I’m not going to link to because it doesn’t link to anyone else) – reports that

The richest fifth have nearly two thirds of the wealth. More startling is that the poorer half of us speak for just 9p in every £1 of privately held wealth.
Private household net wealth in Great Britain totalled £9 trillion in 2006/08 and nearly 80% of this is accumulated in property and private pension entitlements. 

Median household net wealth was £204,500 in 2006/08. The least wealthy half of households accounted for only 9 per cent of wealth, while the wealthiest 20 per cent of households had 62 per cent of total wealth.

The least wealthy 10 per cent of households had negative total net wealth
Median net wealth – including pensions, houses and cars, but excluding mortgages and other debt – of a household in the South East is £287,900. In Scotland, it is £150,600.

Thirdly, you could use the recent Barclay’s wealth report I blogged about two blogs back

Fourthly, everyone of course knows about the rich list – I’m now reliant on other people’s summaries of this because of the Time’s paywall, and in any case, its international so the this list isn’t UK focussed and it doesn’t talk of ‘distribution’ focussing merely on the worst excesses.

Finally, For income inequalities – we can rely on the JRF’s yearly report on Poverty and Inequality – but this is based on income measurements rather than wealth.

You might like to think about why it’s so hard to find info on this stuff… Or if you know more about where to get this data from than I do, let me know!

Social Trends 41 – Income inequality in the UK – updates

Wealth and income data is one of the most important things that Sociology students should keep an eye on – in fact I think everyone should keep an eye on this data, bearing in mind its limitations of course!

All of the data below is taken from the ‘wealth and income’ chapter of  Social Trends 41 – published in 2011 (so if you want updates for next year type in ‘Social Trends 42’ to Google and you should get a link straight there!).

Trend 1 – we are 2.5 times richer today than in 1970

We are richer in terms of both ‘GDP’ – or Gross Domestic Product – which is the total value of goods and services produced in the UK in a given year, and in terms of real disposable income which is the post tax and benefit income available to households after an adjustment has been made for price changes.

The chart above demonstrates the beauty of Official Statistics – ‘cos we’re dealing with numbers, you can get a snap shot indicator of how much wealthier we are today than in the past (or poorer if you take the last two years). Also note the ‘official’ bit – the government is one of the few institutions that can maintain such an enormous task of data collection over several decades – what other institution could reliably collate figures on GDP?

Having said this – there are several things these wealth figures do not show us just one of these things is ‘income distribution – and if you look at the table below, you’ll notice 2 things – 

(Trends 2 and 3) – Firstly that the richest 10% are four times richer than the bottom 10% – and secondly that the richest 10% have got richer quicker than the median and poorest 10%

Distribution of real household income
 

Breaking this down even further – we have the chart below – which shows us that there is a much greater concentration of people at lower levels of weekly income, with nearly two-thirds of individuals living in households with disposable weekly income lower than the mean. There is a long ‘tail’ of people at the higher end of the distribution with an estimated 6 per cent of individuals (or 3.7 million people) living in households with disposable incomes of £1,000 per week or more.

NB – These are precisely the kind of people that will send their children to private school (7% of children go to private school) – if you did not go to private school – you will probably never be one of these people!!!

Looked at another way – there is approximately 15% of the population – or about 13 million individuals living below the Government’s own poverty line of 60% of median income. This basically means you have enough to survive week to week, and have little money left for luxuries or a social life. (Note – The government’s own analysis in social trends doesn’t actually mention this – you need to look at the further analysis done by the excellent Joseph Rowntree Foundation).

Trend 4 It’s also worth quickly looking at who is in poverty – People living in lone parent households and pensioners living alone were more concentrated at the lower end of the income distribution (39 per cent and 27 per cent respectively in the lowest fifth).

As a very final comment its worth mentioning that this whole chapter of Social Trends could be regarded as ideologically biased – its not as if the government can hide the vast income and wealth inequalities – but it does a fairly good job of making them seem berable – because of its limited interpretation of the stats and because it doesn’t spend too long talking about wealth distribution – where the disparities in the UK are far greater! I’ll post later with other sources that put a somewhat darker spin on wealth and income inequalities in the UK

 

 

More Indicators of rising wealth inequality

Not that you’d know it if you tuned into BBC breakfast…

Having avoided this show for over a month, I weakened this morning (well, I’ve got a slack work day coming up) – within 5 minutes I was reeling from the juxtaposition of an economic item on ‘low interest rates mean it’s not worth saving because of increasing inflation’ and ‘M and S’ posted a profit –

I mean here we have the BBC subtly telling the population to spend, because it ain’t worth saving and then the report that shows us the consequences – I mean what’s the message here – spend money on crap you don’t need in order to make the bosses of big companies money – and we’ll report that with a big smile on our faces.

This whole affair prompted me to do a bit of digging – here are some other interesting wealth juxtapositions

Firstly, the number of UK Millionaires has increased by 19% since 2008 –

  • New figures show there are 619,000 millionaires in UK today, up from 528,000 in 2008
  • There are 86,000 millionaires with a wealth of £5m or more living in the U

This stands in contrast to the fact even average earners are using their Savings to meet basic expenditures such as paying bills.

Secondly, housing prices are falling everywhere in the country – except for those in central London – where the rich live (the ‘top feeders’ as a friend of mine likes to call them) – of course for most ordinary home owners – who have mortgages with banks – do the banks really care if they lent them 300 000 five years ago and that house falls in value to 200 000? Of course they don’t – because mr mortgage still owes them 300 000 plus interest. The richest of course will just buy their houses outright.

Oh, and Crimewatch is on tonight – I can’t wait to see what delights of agenda setting that little gem holds.

Increasing income inequality in Britain

The Institute for Fiscal Studies recently published its latest report on poverty and inequality in Britain – below are some of the key findings

This data is derived from the Family Resources Survey, a survey of around 26,000 households in the United Kingdom

Income distribution

distribution household income copy

The above table shows the UK income distribution in 2009–10. The graph shows the number of people living in households with different income levels, grouped into £10 income bands. The height of the bars represents the number of people in each income band. The figures are after tax and benefits and before any costs such as housing are taken into account.

  • Median equivalised income (equivalised to a couple with no children) stood at £413 a week. This basically means that 50% of people live in households below $413 a week, and 50% above this point.
  • It is also noteworthy that more than 1.4 million individuals, out of a private household population of approximately 60 million individuals, have equivalised household incomes above £1,500 a week.

Of course, what you don’t get from the above table is a measurement of ‘quality of life’ – for the poorest, their cost of living is going to be higher – as they can’t afford cars to get to supermarkets to buy cheaper food for example and poorly insulated houses cost more to heat. Also, for the very rich, they probably own their houses out right and so they have no housing costs. Finally, some of that income going to richest 1.4 million people will be in the form of rent being paid by the bottom third or so of individuals who cannot afford mortgages – you know, like young students at university. That will be some of you in two years time – paying your rent to your rich landlord- doing your bit to make sure that that that bar at the right hand side of the graph remains standing tall.

Finally, also note that this tells you little about how people feel about being poor or being rich – for info on these check out these two blogs (links to be added later)

Changes in income distribution

income changes

The above table basically shows you that, for the masses in the middle, some income has been redistributed to the poorer. However, if you look at the extremes, note that both the number of extremely poor people and extremely rich people have both increase – hence Britain has become a more unequal country over the last decade – this is most graphically illustrated by the Gini Coefficient

Gini

The Gini coefficient reduces the entire income distribution into a single number between 0 and 1: the higher the number, the greater the degree of income inequality. A value of 0 corresponds to the absence of inequality, so that, having adjusted for household size and composition, all individuals have the same household income. In contrast, a value of 1 corresponds to inequality in its most extreme form, with a single individual having all the income in the economy.

One of the things that prevented this spiralling out of control under new labour were the benefits system they had in place that redistributed income away from the relatively rich (not the very rich) to the poorest.

Watch out for income inequality increasing even further under the conservatives!