In a fast-changing world, the government must help people seize new opportunities rather than resist change
The minister for trade Lord Jones often says that if the 20th century was Europe’s century, the 21st will be Asia’s century. As the balance of economic power is shifting to Asia, our focus is also shifting so that we can make the most of the opportunities this represents. I want to make a few points about what these changes mean for the world of work here in the UK and how they serve as a critical context for what we are doing in domestic policy.
First, there is a need for the government to ensure a labour market with rules, to ensure decency and to guard against the exploitation of people that still exists in the 21st century. We know that in a world of mobile capital and people, we won’t compete with the wages in the lowest paying countries – and we do not try to do so. We want flexibility and innovation. We want to see British companies leading the world in design and technology, in seeing the changes to come and making the most of them. But we also know not every job is like that. There are and will be millions of people doing work which does not live up to that billing. They need the government to ensure decency and dignity at work and that is what we have tried to do.
The first place to start is of course the minimum wage, now an established and almost uncontested feature of the labour market and an important measure of decency that has not destroyed jobs but set a floor beneath which no one should fall.
At the same time we have today a new effort to make sure the minimum wage is better enforced, with more resources and staff behind that effort and changes in the law to ensure compliance. We are changing the law to toughen up on enforcement, introducing better arrears for those underpaid and stiffer penalties for those who underpay.
In addition to this, we have made a number of changes which recognise that parents need help with the twin responsibilities of family and work. Compared to a decade ago there is much better maternity and paternity pay and leave. Plus we have the right to request flexible working for parents of younger children and carers, with Imelda Walsh’s review looking at extending that right to parents of older children.
But having ensured these rights, we must let business and enterprise flourish. We must beware of erecting barriers between the insiders and the outsiders in the labour market. We want business to succeed but in hoping for that we know that some businesses will fail. And we have to support the process of risk-taking and entrepreneurship involved in any successful economy. The flexibility that characterises Britain’s economy relative to some others should not be cast aside. It is what enables us to cope with global events and it helps keep barriers to hiring people low, contributing to widening opportunity rather than leaving people shut outside.
And because of the importance of opportunity in today’s world and of making sure that any country uses the talents of all its people there is a second critical area for the government which is to equip people to deal with change. In fact, a response to today’s world that says equip the worker, don’t protect the job, is essential if countries are going to create the best chances for their people and for their economies.
Industries will rise and fall. Investment will flow to and from newly rising economic powers. And these changes can be profoundly difficult for the communities affected as they have been for my own constituency. But the right response is not to try to freeze the world, to erect barriers or to keep competition out. It is to equip our people to prosper in an age of rapid change.
Globalisation is uneven in its impact. In some places the loss of jobs leaves people reticent about the future and conscious of a more secure past. It is because of this uneven impact that the need to equip people for change becomes all the more important. So from the early years, right through to the times after formal education has ended, we have to give people the tools to succeed in today’s world, to raise levels of ambition and expectation so that they gain both the hard skills in terms of qualifications and the soft skills in terms of social confidence and people skills that will open up opportunity for them in tomorrow’s labour market.
In other words, the assumptions of yesterday and perhaps even of today about what will do in terms of education standards are not enough. They have to be re-examined and reassessed.
So when it comes to school reform, from academies to specialist schools and trusts, the question is not whether these changes go too far, it is whether they go far enough. When it comes to training, we need to ask not just whether we are doing enough to help people do the job they have but whether it may help them if they have to change jobs in the future, as is far more likely than in the past.
Of course, all of this takes place against a backdrop of different kinds of jobs. More financial services, more staff in education and health, less in manufacturing, more teamwork and a decline in the traditional nine-to-five day reflecting consumer demand for services outside the traditional office hours. All of these trends are impacting on the modern labour market.
We are in a fast-changing world where the government’s role is to ensure decency and dignity while allowing creativity and enterprise. Patterns of work are changing which require people to be better skilled and equipped than before. For individuals and for countries, it is those who seize the opportunities rather than resist the changes who will succeed.
This article is also available on the Progress Online website. Posted on 7 February 2008.