2020 job market projected to push poverty even higher

Tackling poverty means tackling the weak job market

Research we publish today looks at the impact of the projected job market in 2020 on poverty in the UK. Unfortunately, it’s more bad news. The implication is that we should target jobs and training assistance on the basis of household, not just individual, need and focus unerringly on the creation of more and better jobs.

The research uses a forecast of the type of job market we expect to have in 2020 and combines this with a model of household incomes that includes announced tax and benefit changes. The central forecast for 2020 is for many long-term trends to continue, including shifts towards a knowledge- and service-based economy and increases in high- and low-paid jobs. We already know that cuts to benefits and Tax Credits are likely to undermine the beneficial effects of Universal Credit. This will lead to (in combination with demographic and earnings change) rising poverty rates over the rest of the decade. Adding in an estimate of changes in the job market increases inequality further, although it does offset some of the rise in absolute child poverty.

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So, changes to taxes, benefits, demography and earnings (the blue bars) increase absolute child poverty in 2020 by just over 6 per cent but job market changes (the red bar) offset this a tad. Turning to the relative measure, tax and benefit changes raise poverty by around 5 per cent and the projected job market adds another 1 per cent by 2020. All groups except households headed by someone aged over 65 see rising absolute and relative poverty from tax and benefit changes, with lone parents hit particularly hard. Employment change makes things worse for everyone except for absolute poverty among families with children.

We weren’t naive enough to expect the central forecast to eradicate poverty, so the plan was then to try out some different scenarios that JRF, the research team and our advisory group thought might have a positive impact. These variations were all based on changing the distribution (but not increasing the number) of jobs, and we didn’t vary the tax and benefit system. The second chart shows the impact of some of these scenarios on relative child poverty rates (the long bar shows the predicted 2020 rate of 25.7 per cent).

None of the alternative scenarios (the short bars) have any meaningful impact on that central child poverty projection. Keeping the employment structure as it is now would decrease poverty by a tiny 1.2 per cent. This is the biggest difference. A general rise in qualification levels across the workforce and reduced pay for the highest qualified, for example, actually increases child poverty more than in the central forecast (by 1.0 per cent). Most other scenarios have virtually zero effect by 2020.

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There are two core reasons for this disappointing lack of impact. The first is that low paid and poorly qualified workers, along with women and part time workers, are spread across the whole household income distribution. This means targeting these workers is not an especially effective way of targeting poverty. The second is the huge ‘drag’ on poverty rates of the large number of workless households in the UK.

What do we do about these worrying findings? It is clear that interventions such as training and skills development need to be targeted on the basis of household need, not just individual need if we are to have a serious impact on poverty. It is also clear that we need more jobs. A lot more, because the 1.5 million new jobs included in these forecasts is going to be nowhere near enough when 6 million people in the UK are currently seeking more work.

A child in the Gorton estate in Manchester, where 27% of children live under the poverty line. Photograph: Getty Images

Chris Goulden is deputy director of policy and research at the independent Joseph Rowntree Foundation (JRF).

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After the defeat of Hillary Clinton, what should the US left do next?

For disappointed Bernie Sanders supporters and others on the left, the big question is now: should they work within the Democratic party?

For the majority of the US left, Hillary Clinton’s electoral defeat came as a surprise. Sure, they’d had doubts about her candidacy from the start. They’d expressed disgust at her platform, history, priorities and dubious associations – not least, at her campaign’s focus on cosying up to wealthy elites, courting the support of billionaires such as slum landlord Warren Buffett, at the expense of trying on to hold on to the party’s core working-class vote – but the general belief was that, however undeservedly, she’d still manage to pull it off.

After all, polling suggested she maintained a fairly consistent lead in key swing states even as Trump somewhat narrowed the gap, and there was reason to think that demographic trends would work against her competitor, who openly courted white supremacist votes.

Hindsight is 20/20, but many now feel they took their eye off the ball.  Leslie Lee III, a writer from Louisiana currently residing just outside Washington DC, argues that people “got so worn down by the polls that we forgot our message, that Clinton was the worst possible candidate to put against Trump”. For him, identifying what went wrong is simple:  “Trump promised people something, the establishment candidate was telling people America was already great. It doesn’t matter if he was doing it in a dishonest, con-artist, racist, xenophobic, sexist way – he said he’d fix people’s problems, while Clinton said they didn’t have problems”.

Leslie isn’t alone in believing that a wonkish focus on polls and data distracted from what was really going on. Everyone I speak to feels that the supposed ‘experts’ from the liberal mainstream aren’t equipped to understand the current political landscape. “We are witnessing a global phenomenon,” suggests writer Amber A’Lee Frost, who first got involved with the Democrats to support the Sanders campaign but voted Obama in 2008. “The UK offers the most clear parallel to the US. Nationalism, racism and xenophobia are festering.” Student and Democratic Socialists of America activist Emily Robinson agrees: “All across the world we’ve seen massive right-wing upswells, from Trump, LePen and May in the West to Modi and Erdogan in the East.” Whatever differences exist between these respective politicians, it’s hard to argue with the contention there’s been a widespread shift to the right.

US left-wingers argue that liberals fail to understand their own role in the current situation. From a British perspective, it’s hard to disagree. Repeatedly, I’ve seen discussions shut down with the claim that even acknowledging economy policy may have contributed to the resurgence of ethno-nationalist ideology amounts to apologism. Nor can faulty data be held entirely responsible for any complacency. In the run-up to the Brexit vote, polls suggested that the result would be too close to call; nonetheless, within the liberal bubble almost everyone assumed we’d vote to remain. The fact the value of the pound rose on the eve of the referendum was seen as evidence for this belief, as if currency traders have some sort of special insight into the mind of the average UK voter. Looking back, the whole thing is laughable.

Over in the US, the disconnect seems to be much the same. “People in the street weren’t following that stuff,” Leslie says of the finer details of both the Trump and Clinton campaigns. “Trump said he would fix their problems, Clinton said they didn’t have any. If we’d stayed focused on that it would have been obvious.” Instead, many of her supporters believed that it was Hillary’s turn and consequently dismissed substantive criticisms, sometimes claiming the vast majority of opposition was simply latent sexism. Even the campaign slogan “I’m With Her” seemed to be about what voters could should for Clinton, not what Clinton would do for them. As polls narrowed, party insiders continued to insist that Clinton was the rightful heir to Obama’s voting coalition, however little she actually did to earn it. 

A lack of message simplicity definitely seems to have been part of the problem. When I speak to Christian, who currently works in outreach and recruitment for the Democratic Socialists of America’s national office, he admits he was barely aware of the platform Clinton was campaigning on. “I’d ask my friends, and sometimes she’d talk about stuff, but it’s so vague,” he explains. “The average working-class person shouldn’t have to go to a website and read a 30 page policy document. It feels like it’s written that way for a reason, it’s muddled, neoliberal bullshit that lobbyists have written.” It’s true that media coverage probably didn’t help, with reporting frequently focuses on gossip and overblown scandal over substantive policy issues, but an effective political communicator must ensure their core messages cut through. Obama managed it in 2008, and however abhorrent we might find it, pretty much everyone heard about Trump’s wall.

It’s also hard to ignite excitement for the continuity candidate when many people don’t believe that the status quo actually benefits them. “I think neoliberalism no longer works as an electoral incentive to voters, especially working-class voters,” argues Amber. Emily tells me that prior to this election she’d worked on two Democratic campaigns, but before Sanders she’d been ready to give up on the party. “When they had the power to, the Democrats failed to implement policies that helped the working class, Hispanic, Black and Muslim communities, and women.”

She explains her disappointment during the early part of Obama’s first term, when the Democrats held the House, Senate and Oval Office. “They jumped away from the single payer option for healthcare, which would have helped the entire American population. The implementation of the DREAM act would have helped immigrant communities. There’s also a lot they could have done on policing and carceral reform, repealing federal use of private prisons, for example, and labour rights, by introducing federal protections for trade unions and effectively repealing so-called ‘right to work’ laws in many states. They did not mandate free, universal pre-kindergarten nor did they even attempt to work forwards free collect – or, at the bare minimum free community college.”

For Douglas Williams, a graduate student at Wayne State University, it was Obama’s relationship with labour unions that caused him to drift away from the party. “In 2013, Barack Obama appointed a union buster to a federal judgeship in the District of Columbia. I started to think, labour gave $1.1 billion to national Democrat party politics between 2005 and 2011, and labour got literally nothing from it.”

One left-leaning activist, who prefers to be identified by his blogging pseudonym Cato of Utica, campaigned door-to-door for Clinton. He explains in visceral detail his disillusionment with the party he’d worked within for roughly a decade: “I was heavily involved in North Carolina in places where the recovery never even touched. These were working poor people, and the doorbells didn’t work. If the doorbells are broken, what else is broken inside the house? What else isn’t the landlord taking care of? I looked at our candidates and none of the people I was pushing were going to address the problems in these people’s lives.”

Much ink has been spilled trying to pin down exactly what motivated people to vote Trump, whose campaign rhetoric was more explicitly xenophobic, racist and sexist than any other recent presidential candidate. Most of his supporters also voted Republican in previous elections, but two other groups are more interesting from a left-wing perspective: those who previously voted Obama but opted for Trump this time round, and non-voters who were inspired to make it to the polling booth for the first time. Overwhelmingly, both groups are concentrated in lower income categories.

“I think people voted for Trump because he acknowledged that there is something very wrong with America,” suggests Amber. “I obviously disagree with Trump voters on what is wrong with this country, and the fact that his campaign was fuelled by nationalism and racism certainly gave it a terrifying edge, but I know why they voted for him, even though he will ultimately betray his most vulnerable supporters.”

It would be absurd to discount racism as a factor in an election where the winning candidate was endorsed by the official newspaper of the Ku Klux Klan and its former leader David Duke, but Leslie disagrees with those who claim it was the primary motivation for the most Trump voters. His earliest political memory is from around 4th or 5th grade, when David Duke was running for Governor of Louisiana. “As one of the few Black kids in your class,” he recalls, “it really makes you realise how important politics is early on”. One of his closest friends was a previous Obama voter who opted for Trump this election, and the common factor seems to have been a message of optimism.

“Obama offered something more important than these people’s prejudices: hope and change, basically. He didn’t deliver it but he offered it. Romney was seen as the establishment. Obama said, ‘I’m an outsider and I’ll bring something new to the table’. There’s a line between Trump and Obama in that vein – and my friend will tell you the same.”

At a time when many people have a strong desire to kick out at the political establishment, Clinton was the ultimate establishment candidate. Leslie is scathing about the extent to which she actively highlighted this in her campaign: “She talked about being experienced – what does that mean? It means you’ve been part of the establishment. She attacked Obama with her experience in 2008 so I don’t know why she thought it would work. It’s not like being the local dog catcher, you don’t turn in your resume and if you have the most experience you get it. You need to have a message and get people inspired, and she didn’t have it.”

Most of the people I speak to believe that Sanders would have had a better chance of beating Trump, and many poured significant time, effort and money into his campaign. They note that polling showing Sanders had consistently higher approval ratings amongst the general public than Clinton throughout the primaries, and argue that people citing recently released unused opposition research as evidence he’d have lost don’t understand voter motivations. The idea that Sanders’ experience of being poor and unemployed would have worked against him is seen as particularly mockable. Whatever the truth, the more relevant question now is what the left does next.

Opinion is split between those who think working within the Democratic Party is the best approach and those who believe its unaccountable, bureaucratic structures make it a lost cause. Emily is in the first category. “I think leftists should, in a limited capacity, be running within what is now the desiccated carcass of the Democratic Party, rather than naively attempting to build a party from the ground up and risking splitting the left-liberal vote,” she tells me. “They should be prepared to run for elections with a (D) next to their name, even if they refuse to bend at the knee to the neoliberal, imperial tendencies of the Democratic elite.”

Particularly exciting right now is the work of the Democratic Socialists of America, an organisation which aims to shape the future of the party in a leftwards direction. Membership had increased by a third since the election – aided partly by support from celebrities such as Killer Mike and Rob Delaney. “We’re planning on Trump being a one-term president,” DSA representative Christian tells me. “We have a 50 state strategy, but right now we only have chapters in 31 states. It’s not just about elections, it’s threefold: electoral, workplace and community organising to win on all counts.”

Douglas is sceptical about whether it’s possible to restructure the Democratic Party in the way he considers necessary, but he agrees with the DSA’s focus on community organising: “Why can’t an organisation be like ‘we’re going to sponsor a little league team’? Why can’t we open a soup kitchen? We’re making noise, we’re out here, but we heard your aunt is having trouble with her roof. We’ve got guys who can fix that, and then we’ll leave a little sign saying it was us.” Cato of Utica references something similar that happened in Flint, where the Plumbers and Pipefitters Union visited people’s homes to make sure their water filters were properly fitted.

“We need to rebuild the labour movement,” agrees Emily. “Not only to carry out all the normal functions of unions, but also to provide a community, and spaces for education, child care and other forms of support. If we don’t build solidarity among the working class – not just the white working class, but the Hispanic working class, the Black working class and so on – we risk allowing another reactionary movement caused by cleavages promoted by the ruling classes.”

Left-wing organisations traditionally target places like New York, Los Angeles and Chicago, where it’s easier to build support. Christian argues that the Democratic Party, and the DSA specifically, need to “focus on the Rust Belt, where the Democrats lost, and the South, where Bernie lost”. There’s a widespread belief that Southern states which have been Republican for decades now could be winnable in future presidential elections, partly because of demographic trends pointing towards increasingly ethnically diverse voting populations. As for the Rust Belt, it’s hard to argue with the claim that a different candidate could do better than Clinton – who didn’t even bother to visit Wisconsin, which swung Republican, in the months preceding the vote.

The DSA’s 50 state strategy involves creating a national framework, but with devolved power allowing local chapters to focus on the issues most relevant in their area. “In Texas our chapter is really strong and we do a lot of work on immigration reform, working with undocumented communities, whereas Boston obviously doesn’t have to deal with that so much,” Christian explains to me. “In places like Kentucky and West Virginia, coal country, Republicans like Trump will say coal is coming back. We say we actually need to transition to a new economy and create green jobs, and places where people live where they don’t get cancer from coal.”

Christian believes that the unexpected success of the Sanders campaign indicates there’s an appetite for the kind of politics the DSA is offering, and that a similar candidate could gain the Democratic nomination in four years time. “Having a candidate announce earlier than Bernie did, and with a good ground game in place, we could have 50,000 volunteers ready to go. We wouldn’t be scrambling around this time, we’d be ready to go to war with [Trump]”. Like many on the left, he thinks that Keith Ellison’s selection as DNC chair is a crucial part of the puzzle. Ellison was the first Muslim elected to Congress and is chair of the Progressive Caucus. “He’s a way better politician than Bernie,” Christian contends. “He understands the intricacy of talking about labour, poverty and unions very well.”

Others I speak to argue that focus should be on working from the ground up. “I’m not even talking about state legislatures,” explains Douglas. “I mean city councillors, school boards, things like that. This is going to be a long-term project and has to start at the absolute lowest level and work its way up. People don’t even realise, in some of these cities you can get elected to the city council on 500 votes. We want to start on the big stuff but it has to be an independent, left local movement. We can run all the candidates we want, but unless we’re out here informing people ‘it’s not actually about Mexicans or Muslims, it’s your boss, it’s his fault you can’t afford to save the money to send your kids to college,’ what’s the point?”

Whatever disagreements about strategy exist, the US left seems to be united by two things: fear of Trump’s presidency and a determination to succeed. Many members of the DSA are worried about their involvement with the organisation being publicly known. Unsurprisingly, this is more acute for members of groups attacked in Trump’s rhetoric. “We see apprehensiveness with some of our Latino membership,” Christian tells me. “People don’t want to out themselves because that's risking your own livelihood. We’re a working class organisation and most people have other jobs.”

With Trump associates making noises about recreating the House Un-American Activities Committee, some fear left-wingers could be targeted as dissidents as in previous decades. However realistic the threat of government persecution, there’s already a far-right website, KeyWiki, that keeps tabs on members of socialist organisations. Everyone I speak to agrees that groups particularly vulnerable to being targeted by Trump and his supporters – including Muslim, Latino and African American communities – must be defended at all cost. “The aim of the left should be to make it impossible for Trump to govern,” says Cato of Utica. “Establishment Democrats are already making conciliatory noises. If the Democrats aren’t going to do it in the Senate, the people have to do it in the streets through direct action.”

When I ask Amber what happens next, her response seems to sum up the mood amongst the US left: “To be honest, I have no idea. I’m terrified but I am ready to fight.”