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Urgent action need to tackle low pay

Posted: 13/01/2017

Urgent action need to tackle low pay

For immediate release: 13 January 2017

Commenting on today’s report on income inequality in the UK from the Institute for Fiscal Studies has underlined the need for urgent action by both employers and government to address the entrenched nature of low pay in our labour market. Most coverage of the report has focused on the finding that men on low pay are four times more likely to be working part-time than in the 1990s, but this is only one part of the complex story that the report presents. The report also highlights that household earnings inequality has risen, due to the increase in low paid part-time male employment, but that net household income inequality had actually fallen over the last 20 years. This fall has been as a result of increased incomes for households through tax credits, occupational pension payments for older people and a general fall in worklessness.

Commenting on the report Peter Kelly, director of the Poverty Alliance, said:

“Today’s coverage of the IFS report has focused on the growing earnings inequality between men as the result of a long term increase in male part-time employment. However, this important report tells us far more about the way our labour market is changing and the need to take more concerted action.

“In recent decades we have seen a shift towards low pay, poor working conditions and an increase in the use of zero or low hours contracts.  The combination of these things is responsible for the growth of in-work poverty across the UK. 

“Given that women were always more likely to be low paid and in part-time employment, and remain so, it was perhaps inevitable that as we deregulated our labour market and restricted the scope for action by trade unions then more men would be caught up in the trap of insecure, low paid employment. 

“That women were historically more likely to be low paid was a result of direct and indirect discrimination, a situation that was always unacceptable and remains so.  This fact hasn’t changed. Nor has the fact that the entrenchment of low pay in the UK economy is not inevitable.

“Both the Scottish and UK Government must do more to tackle the growth of low pay.  This means, as a minimum, further promotion of the Living Wage, and greater enforcement of the National Minimum Wage.  It also mean placing decent work at the heart of their labour market and industrial strategies.

“In addition, employers need to do more. They need to ensure that all workers are paid a Living Wage and that flexible working practices are used in ways that support workers rather than penalising them.

 

ENDS

For more information please contact carla.mccormack@povertyalliance.org

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