Real wages for 22-29 year olds down 9 per cent on 2008 Photo: Andrew Burton/Getty
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Young workers biggest victims of the squeeze on wages, study finds

Nearly all groups have seen a decline in real wages since the financial crash of 2008 but losses have not been spread out equally. 

Young workers are the biggest victims of the squeeze on wages, according to a new report that maps out British earnings since the financial collapse of 2008.

The research, by the Institute of Fiscal Studies (IFS), adds that while employment rates have returned to a pre-crisis level, real wages remain “well below” their peak for nearly every group. But losses have not been spread out equally: for those aged between 22 and 29, median hourly pay in 2014 was 9 per cent lower than before the great recession; those over 60 and in work found their wages returning back to a pre-crisis level. 

The report follows last week’s IFS research that claimed middle to higher income households had actually escaped “remarkably unscathed” from the coalition’s austerity measures. Jonathan Crib, an author of the report, said: “Almost all groups have seen real wages fall since the recession… Women have seen much smaller falls than men. Falls for the low-paid have been somewhat smaller than those on higher pay, driven by trends since 2011.”

Part of the explanation for the report’s gender-divide is that female employees are significantly more likely than men to work in the public sector. And, so far, the mean earnings falls in the public sector have been smaller. While women’s average hourly pay fell by 2.5 per cent in real terms between 2008 and 2014, men’s pay fell by 7.3 per cent. 

But this trend is begining to change as private sector wages start to recover and public wages are squeezed as part of the government's mission to balance the books.

Rachel Reeves, the shadow work and pensions secretary, immediately seizing on the figures said: “This report shows David Cameron has overseen falling wages and rising insecurity in the labour market. Working people are £1,600 worse off a year under the Tories.

Only Labour has the plan to tackle low pay, and to earn our way to rising living standards for all, not just a few as part of our tough but balanced plan to get the deficit down. We will raise the National Minimum Wage to at least £8 an hour, get more homes built, cut business rates for small firms and ensure people are paid a Living Wage.”

Interestingly, the report found that the proportion of part-time workers who say they work part-time because of a lack of available hours is almost double the pre-crisis level.

A spokesperson for HM Treasury said: “This IFS analysis confirms that the UK labour market is continuing to perform strongly. We are seeing a record number of people in work, unemployment falling and wage growth accelerating while inflation falls. UK income equality is now lower than when this government came into office and the gender pay gap is at its lowest since records began. We understand that the impact of the great recession is still being felt and so we’ve cut income tax for 26 million people, frozen fuel duty and frozen council tax. But the job is not done, which is why we must go on working through the plan that is securing a better future across the country.”

 

 

Ashley Cowburn writes about politics and is the winner of the Anthony Howard Award 2014. He tweets @ashcowburn

 

 

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Why Barack Obama was right to release Chelsea Manning

A Presidential act of mercy is good for Manning, but also for the US.

In early 2010, a young US military intelligence analyst on an army base near Baghdad slipped a Lady Gaga CD into a computer and sang along to the music. In fact, the soldier's apparently upbeat mood hid two facts. 

First, the soldier later known as Chelsea Manning was completely alienated from army culture, and the callous way she believed it treated civilians in Iraq. And second, she was quietly erasing the music on her CDs and replacing it with files holding explosive military data, which she would release to the world via Wikileaks. 

To some, Manning is a free speech hero. To others, she is a traitor. President Barack Obama’s decision to commute her 35-year sentence before leaving office has been blasted as “outrageous” by leading Republican Paul Ryan. Other Republican critics argue Obama is rewarding an act that endangered the lives of soldiers and intelligence operatives while giving ammunition to Russia. 

They have a point. Liberals banging the drum against Russia’s leak offensive during the US election cannot simultaneously argue leaks are inherently good. 

But even if you think Manning was deeply misguided in her use of Lady Gaga CDs, there are strong reasons why we should celebrate her release. 

1. She was not judged on the public interest

Manning was motivated by what she believed to be human rights abuses in Iraq, but her public interest defence has never been tested. 

The leaks were undoubtedly of public interest. As Manning said in the podcast she recorded with Amnesty International: “When we made mistakes, planning operations, innocent people died.” 

Thanks to Manning’s leak, we also know about the Vatican hiding sex abuse scandals in Ireland, plus the UK promising to protect US interests during the Chilcot Inquiry. 

In countries such as Germany, Canada and Denmark, whistle blowers in sensitive areas can use a public interest defence. In the US, however, such a defence does not exist – meaning it is impossible for Manning to legally argue her actions were in the public good. 

2. She was deemed worse than rapists and murderers

Her sentence was out of proportion to her crime. Compare her 35-year sentence to that received by William Millay, a young police officer, also in 2013. Caught in the act of trying to sell classified documents to someone he believed was a Russian intelligence officer, he was given 16 years

According to Amnesty International: “Manning’s sentence was much longer than other members of the military convicted of charges such as murder, rape and war crimes, as well as any others who were convicted of leaking classified materials to the public.”

3. Her time in jail was particularly miserable 

Manning’s conditions in jail do nothing to dispel the idea she has been treated extraordinarily harshly. When initially placed in solitary confinement, she needed permission to do anything in her cell, even walking around to exercise. 

When she requested treatment for her gender dysphoria, the military prison’s initial response was a blanket refusal – despite the fact many civilian prisons accept the idea that trans inmates are entitled to hormones. Manning has attempted suicide several times. She finally received permission to receive gender transition surgery in 2016 after a hunger strike

4. Julian Assange can stop acting like a martyr

Internationally, Manning’s continued incarceration was likely to do more harm than good. She has said she is sorry “for hurting the US”. Her worldwide following has turned her into an icon of US hypocrisy on free speech.

Then there's the fact Wikileaks said its founder Julian Assange would agree to be extradited to the US if Manning was released. Now that Manning is months away from freedom, his excuses for staying in the Equadorian London Embassy to avoid Swedish rape allegations are somewhat feebler.  

As for the President - under whose watch Manning was prosecuted - he may be leaving his office with his legacy in peril, but with one stroke of his pen, he has changed a life. Manning, now 29, could have expected to leave prison in her late 50s. Instead, she'll be free before her 30th birthday. And perhaps the Equadorian ambassador will finally get his room back. 

 

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