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How safe is your job?

This has been a year of financial panic, but 2009 will be dominated by unemployment. In a flexible l

The poster that won the 1979 general election was a fake. The "Labour isn't working" dole queue was ac tually composed of 20 fully employed Hendon Conservatives, photo graphed by Saatchi & Saatchi. But there was nothing synthetic about the impact that the poster had on the Labour government of James Callaghan. Never again, Labour resolved, could the party afford to go to the country when the country was out of work. Yet that is what Gordon Brown risks doing, if you believe the spin about him delaying the next general election until 2010.

This was a year of financial panic as oil prices spiked, banks collapsed and stock markets tumbled. But it is likely that 2009 will be the year of the dole. Unemployment, already higher than at any time since Labour came to office in 1997, is expected to climb to almost three million by 2010, according to the Confederation of British Industry. The turnaround in the UK employment market has been astonishing. The pace of job losses, led by the shake-out in the banking sector, has astounded analysts: the Centre for Economic and Business Research (CEBR) has forecast that 300,000 private-sector jobs will have been lost in the six months to the end of this year alone. The CBI's forecast, made only a few days ago, is almost certainly an underestimate, because it is based on Britain's GDP declining by 1.7 per cent in 2009. The Bank of England is now talking about the economy shrinking by 2 per cent next year, as Britain enters the worst recession since the 1980s. Capital Economics has forecast that unemployment will peak at 3.3 million in 2010.

The situation is already worse than the formal statistics suggest. Stephen King, of HSBC, argues that the official International Labour Organisation unemployment figures exclude two million people who are economically inactive but would like a job.

What is undeniable is that British firms are taking advantage of the "flexible" labour market to fire first and think later. Unusually, the region hardest hit is likely to be the one most able to cope: the south-east. The London area alone could lose 650,000 jobs, according to the Local Government Association. This is one of the wealthiest areas on the planet thanks to the financial services sector based in the City. Redundant middle-class professionals might find life a little different on £60-a-week Jobseeker's Allowance, but most can probably look after themselves. The people who will have their lives destroyed first are the legion of temporary and casual workers, many of whom do not figure in the unemployment statistics because of their age or country of origin.

Many of the new redundancies are unavoidable, but there are signs, too, that some firms are reducing their workforce as a message to shareholders, hoping to bolster their equity prices. When BT announced 10,000 redundancies on 13 November it made no attempt to play down the human cost and, according to some analysts, even exaggerated the job losses for effect.

After three decades of losing industries, the UK desperately needs to protect the skills it has left, not allow them to dissipate in the lengthening dole queues

Firms such as Virgin Media, Rolls-Royce, Yell, Wolseley and Citigroup have all announced thousand-plus job cuts in the past few weeks alone. The flexible labour market, inspired by the Tories and realised by new Labour, has allowed contraction to be a first, rather than a last, resort. It is the quickest way for a management in trouble to show that it is doing something.

The problem is that these job losses, rather like the banks' refusal to lend to small business, are enormously destructive to the broader economy. After nearly three decades of losing productive in dustries, the UK desperately needs to protect those skills it has, not allow them to dissipate in the dole queues. But with trade unions weak, employment law liberal and the government compliant, firms are being allowed to throw out the seedcorn of the future.

Only the state would be able to counter the effects of this attrition. In the pre-Budget report, the Chancellor's measures on benefits, pensions and VAT were intended to boost pre-Christmas demand in the high streets. However, the government is severely limited in its ability directly to fill the jobs gap. Yes, the public sector is still hiring, and will have put on 50,000 jobs in the six months to the end of the year, according to the CEBR. But, with public borrowing likely to reach at least £118bn next year, there will have to be a retrenchment in the labour-intensive public sector to get the public finances into some kind of order in the medium term. Make no mistake - the price of this year's fiscal stimulus is likely to be public-sector job losses, even with the Chancellor's heroic, and unrealistic, assumptions about an economic recovery in 2010.

In this instance, the weakness of the pound is unlikely to boost employment in export industries. This is a global recession, perhaps a global depression, and Britain cannot rely on international markets to replace lost domestic demand. There is also likely to be a wave of protectionism, starting in the US, as countries seek to save their own core industries with state subsidies and other anti-competitive tools. The world market may be a tougher place in which to sell in future. Anyway, Britain has lost most of its manufacturing base - down to 14 per cent of GDP.

In recent years, most of our "exports" have been in financial services - "invisibles", the demand for which will be slight for the duration of the credit crunch.

We can be thankful at least that the right man is in the White House at the right time. Alistair Darling has moved some way towards matching Barack Obama’s plan to create 2.5 million jobs over the next two years through public work projects and alternative energy investment. Yet this will not happen quickly and will do little to alter job losses already in train. And, in America, which is 12 to 18 months further advanced into the recession than Britain, life is already desperate for people on the margin.

The US department of agriculture reported on 17 November that the number of children who went hungry in 2007 - the first year of the credit crunch - jumped by 50 per cent to almost 700,000. It said that, overall, 12.2 per cent of Americans, 36.2 million people, "do not have the money or assistance to get enough food to maintain active, healthy lives". It could happen here.

At the very least Britain faces a return to a period of sustained joblessness, and to the destructive psychology that accompanied it. There will be dole queues, of course, but the social composition of the new jobless - led by financial services, property, retail - will be very different from what we saw in the early 1980s. As a recent report from the Chartered Institute of Personnel and Development argued, those at most risk in the coming "redundancy torrent" will be managers, professionals and skilled non-manual workers.

Tens of thousands of jobs are about to eva porate from British banks. Multiply that by all the professional jobs which depended on those middle-class incomes, such as estate agents and lawyers. Certainly, the first to be hit will be those at the bottom. But they are likely to be joined by large numbers of articulate, middle-class individuals shaken out of the financial, media and peripheral service occupations - from aroma therapy to management consultancy - which have grown up during the long boom.

Middle-class workers are not ready for this and it will be a shock to their self-confidence and self-esteem – a social and cultural transformation that could have profound political implications.

In the 1980s, the middle classes were still relatively secure in their career structures in management and the professions. They had homes, occupational pensions, clear employment paths. Certainly, they were a world away from the trade unionists fighting for their jobs in the old industrial heartlands of Britain. Margaret Thatcher relied on the middle classes to support her war on the militants with their braziers - and to blame them for the recession of the 1980s. The braziers are gone and the industrial working class has largely been dismantled. So, too, have the secure middle-class career structures.

Those who will suffer are the children of the baby boomers, who graduate with high debts and higher expectations

In the 1980s, professional and other white- collar jobs were, by and large, jobs for life, with annual pay increments, annual promotion, pension rights and a predictable future. Not any longer. The modern media, for example, are a shifting sea of freelance and contract workers for subcontractors to the large institutions. Even at the BBC, where I started out, there may be a crust of well-paid performers and anonymous executives who earn more than the Prime Minister, but below that is a huge army of irregulars, often on low salaries, coming in and out of the corporation's revolving doors. The commercial sector has been relying on large numbers of underpaid or unpaid "interns" desperate for work. This is the flexible labour market at its most pernicious. Such practices are widespread throughout the British economy.

Deregulation and leveraged buyouts by private equity over the past two decades have left many firms with flattened management structures, often relying on outside consultants to get them through busy periods. Occupational pensions have become a rarity. Promotion has become intensely meritocratic. Companies increasingly "offshore" white-collar functions to countries such as India, where an educated middle class is willing to work for much lower wages. Most of the job losses at BT are among self-employed contract workers in the UK; the firm has not cut any of the jobs it has outsourced to India.

The group hit hardest is the under-35s, sons and daughters of the postwar baby boomers, who have emerged from university with high debts and even higher expectations. These are the young people who have little experience of recession and none of mass unemployment. Neither have many of their parents, who lived through the 1970s and 1980s largely untouched by unemployment or debt. If there is to be a political response to the new depression, it is likely to emerge from this group of déclassé graduates, many of whom face a future without the security they have been brought up to expect. They will not be able to afford houses or establish careers. Indeed, the under-35s have so much personal debt that their net wealth is actually negative. Three-quarters of the under-35s are in the red, according to the Skipton Building Society, owing more than £9,000 on average. They will look to the state for security, but the state will not be able to deliver.

This time there is no trade union menace to blame for economic distress

A Ministry of Defence think tank has made a remarkable forecast about political militancy. The Development, Concepts and Doctrine Centre published a report in April 2007 in which it speculated that in coming years “the world’s middle classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest”. “The middle classes could become a revolutionary class taking the role envisaged for the proletariat by Marx . . . the growing gap between themselves and a small number of highly visible super-rich might fuel disillusion,” the report said.

The idea of a revolution sweeping suburbia is faintly risible, though it was a subject of a recent J G Ballard novel, Kingdom Come. But the MoD may have grasped an important truth about the nature of politics in the new global economy. It is beginning to erode class differentiation and has left many middle-income earners exposed to the kind of insecurities that formerly afflicted only lower-class workers. Clearly, the economic circumstances of management consultants cannot be compared directly with those of retail workers. But when they lose their jobs, they face very similar challenges: mortgage and credit-card debt, catastrophic loss of earnings and the need for retraining.

Part of the difficulty experienced by the Conservative leader, David Cameron, in developing a coherent political response to Gordon Brown's neo-Keynesianism, is that the party of capital has lost its "class enemy": the industrial working class. There is no trade union menace to blame for economic distress and the Conservatives have had to fall back on "fiscal conservatism" - or reduced public spending. This is simply not a priority for an electorate that is looking to the state to protect it from the predations of the market. Equally, new Labour under Brown has been forced almost against its will to become more critical of the plutocracy running the banks, to accept nationalisation and greatly increased government spending. Brown's government has even had to abandon one of the founding principles of new Labour by proposing higher taxes on the rich.

The Conservatives, who have not entirely lost their Thatcherite reflexes, are looking to the middle classes to react against the new profligacy - but they will find it difficult to do so. As un employment mounts among the middle classes, especially among the under-35s, there is going to be a much stronger demand for policies which promote jobs and growth even at the cost of public borrowing. The Tories cannot afford to be on the wrong side in this battle.

As Martin Hutchinson, author of Great Conservatives, has expressed it: "A world in which few if any have security in their livelihood is not conservative, it is anarchist. It is also deeply repugnant to the average voter."

If Labour isn't working, neither are the Conservatives.

This article first appeared in the 01 December 2008 issue of the New Statesman, How safe is your job?

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Extreme Scottish unionists: how the hard right has muscled into the independence debate

During the last Scottish referendum, pro-union campaigners tried to ignore the most extreme members of their own side. But can they afford to do so again? 

This is one of a two-part series. For the article on extreme Scottish nationalists, click here.

Robert Somynne is a London-born Scot of African-Caribbean heritage. When the Scottish referendum was announced, he was inspired by the civic nationalism of the pro-independence campaign. But when he shared his support online, he found it came at a cost.

“The comments ranged from being called 'filthy Aids wog' to 'fuck off what you doing in Scotland anyway?’” he remembers. “These were usually comments from people who prior to the statements would talk about union and British unity.”

Another time, he was canvassing in the bustling Edinburgh neighbourhood of Leith, when three members of the Orange Order, a Protestant organisation viewed by many as sectarian, surrounded the stall.

“That was the first instance of physical confrontation,” he says. “They spat on the floor close to us, but walked away grumbling.”

With most newspapers focused on the online “cybernats” and pro-independence thugs, Somynne felt ignored. “As a BME pro-Indy person you had to sit and listen to the narrative about Indy people being abusive wondering if you were invisible,” he says. 

Read more: The extreme Scottish nationalists

With a second independence referendum looking increasingly likely, Somynne fears that the pro-union parties warning about “division” are creating a self-fulfilling prophecy. 

“As for physical confrontation,” he says. “I'm honestly worried about certain sections of the No-supporting extremes, who see the independence movement as some kind of 'Jacobite plot' to destroy their British identity.”

In 2014, pro-union parties fought under a banner of economic realism, with the additional message that it was OK to be “Scottish and British”. After the experience of the EU referendum, though, there are murmurings that a second pro-union campaign would have to be fought on more emotional turf. 

So what is behind what Somynne calls “the dark underbelly” of the pro-union campaign? And how likely is it to rear its head again? 

One night in George Square

For many independence supporters, suspicions that the pro-union campaign had resonated with the far right were confirmed on the evening after the referendum. A group of crestfallen, mainly young independence supporters turned up at Glasgow’s George Square, where they were confronted by a group of union supporters waving Union Jacks, singing Rule Britannia and giving Nazi salutes. 

Glasgow SNP councillor Austin Sheridan, who is gay, was at the City Chambers that day, an imperial building on George Square. He left the building to see what was going on. “All of a sudden a guy came up and shouted at me,” he remembers. A video he made on his phone shows middle-aged men calling him “fucking poofter” and “nationalist scum”. 

Sheridan believes the homophobic attack was “clearly organised”. He says: “The group of people arrived at the square all at the same time.” 

In 2014, mainstream political parties succeeded in the most part in distancing themselves from the far-right unionists. 

Scots were treated to the rare sight of the Liberal Democrats, Labour and Conservative leaders agreeing on the need to stay in the UK. 

This cross-party unity did not, however, extend to some of the other groups opposing independence – the British National Party, the UK Independence Party and the Scottish Defence League (which shares anti-SNP posts alongside warnings of a Muslim “invasion”). 

While the fringes continue to share both far-right and an anti-independence messages, Facebook groups purely focused on a passionate defence of unionism have also flourished. Here, the First Minister Nicola Sturgeon is mocked as the TV comedy character "Wee Jimmie Krankie", or the "ginger poison dwarf". 

One of the grassroots groups most consistently pushing the pro-union message is A Force For Good (its Facebook page has more than 4,000 followers). During the 2014 referendum it was not affiliated with the Better Together campaign and describes itself as providing “a historical and cultural background to the Union and the British identity”. 

Its posts mainly thank Theresa May for objecting to a second Scottish independence referendum. However, the founder of the site, Alastair McConnachie, was forced out of Ukip after questioning aspects of the Holocaust (when I asked McConnachie if he still held these views, he referred me to a 2007 blog post in which he acknowledges the Holocaust but adds: "I've questioned and doubt, from a historically-interested point of view, some aspects, specifically with regard to the existence of execution gas chambers.") 

Unionism... and Unionism

There was a second undercurrent to that appearance in George Square. “The violence in George Square was sectarian,” says Dave Scott of anti-sectarian organisation Nil By Mouth, who wrote about the incident at the time. (You can read about sectarianism and the pro-independence campaign here).

While there is no direct link between the pro-union campaign and Protestantism (Jim Murphy, a prominent Better Together supporter, is a practising Roman Catholic), some of the most passionate supporters of the UK are from Protestant groups.

The Orange Order is a controversial Protestant brotherhood that dates back more than 200 years. It is based in Northern Ireland, but has other branches around the world, the largest of which is in Scotland. Orangemen traditionally march on 12 July to celebrate the triumph of the Protestant monarchy over the Catholic King James II. Critics accuse the Orangemen of stirring up sectarian hatred and bringing unrest to the streets (in 2016, 13 people were arrested for minor offences during an Orange march in Glasgow). 

In 2014, the Orange Order campaigned on behalf of remaining in the UK. Roughly 15,000 supporters from both Scotland and Northern Ireland turned up in Edinburgh on the weekend before the referendum for a march through the Scottish capital.

The organisation continues to comment on Scottish politics. The front page of the March 2017 edition of the house journal, The Orange Torch, was dedicated to the prospect of a second referendum. When I speak to Robert McLean, the executive officer of the Grand Orange Lodge of Scotland, he confirms that if there is another referendum, his organisation will get involved again. 

I put to him the complaints of independence campaigners that the Orangemen were a divisive presence. He responds: "If anything, the referendum caused division. If anyone's causing division, it's Nicola Sturgeon." The Orange Order have been in Scotland for 300 years, he adds.

What next for the pro-union campaign?

Orange Order marches – and their sister activity, flute bands – have traditionally been abhorred by what Kevin McKenna, a Scottish columnist, calls the “liberal, godless, political classes” in Holyrood. The Better Together campaign was visibly embarrassed by its orange friends. But that was before Brexit. 

While pro-union political parties in Scotland are still working out their plans, organisers must grapple with the fact that “Project Fear” failed to win the EU referendum. Better Together's victorious campaign in 2014 was similarly pragmatic, with messages of economic stability and - crucially - the promise of staying in the EU. 

In the patriotic fervour of Facebook groups like “Do Not Break Our Unity”, there is a different kind of unionism. It waves the Union Jack with pride, wears the poppy, celebrates the monarchy, approves of Theresa May and voted Brexit. As McKenna wrote in the summer of 2014:

The people who will decide the referendum will not be those in the chattering, political classes but the tens of thousands in the housing schemes across the country… both sides had better start properly to understand their language and their curious ways.

The question for mainstream politicians in Scotland – as in England – is what to do about this well of passionate, patriotic unionism. Can they channel it into an emotional case for unity? And would doing so come at a price? 

Somynne, the independence campaigner and freelance journalist who has written about the referendum campaign, wants to see “calm and constructive” debate on both sides. But he worries it won’t turn out that way. “You're asking fundamental questions about the way we define ourselves and challenging political realities,” he says. “It's never going to be clean when that happens.”

Read more: The extreme Scottish nationalists

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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