It’s become common to hear Labour politicians using the language of security. The shadow chancellor Rachel Reeves has even coined the phrase “securonomics” to describe her party’s plans to build resilient, domestic supply chains and a more productive, national economy. The immediate drivers for this are pretty clear. Security is a thread that connects all the issues that matter to voters right now: from fragile family finances to worries about the NHS and crime. It also speaks to the mood of the moment, after 15 years of macro shocks with human impacts, from the financial crisis to Brexit, Covid, spiking inflation and now rising interest rates.
All of this has been compounded by major transitions prompted by climate change and big technological breakthroughs in automation and artificial intelligence. In this age of uncertainty, it’s hardly surprising that the theme of security – for households and for the country as a whole – has become so important in our politics.
The question, though, is whether the political invocation of security simply reflects a shift of language and framing, or whether it heralds something more profound and substantive. Will our political class initiate the step from security rhetoric to a real politics and policy of common security? A new Joseph Rowntree Foundation paper argues that it could, and it should. Focusing on economic security, we suggest that this concept offers a powerful lens for thinking about what matters for social justice in principle, and for making sense of what’s going on in people’s lives right now. From this starting point, we try to show how an ambition to expand the foundations of economic security to more households could inject energy, purpose and orientation to a project for social reform, in ways that could also help catalyse shared economic prosperity.
But first, let’s start with what economic security means. It’s a concept rooted in household finances, drawing on the dynamics of income, costs, assets and debt, in response to events and across the course of a life. But we argue it also rests on wider factors, like employment, housing, education and health, as well as relationships of family, friends and community. These interact to shape the exposure of households to risks and their ability to cope in response. It’s these longer-range foundations – rooted in work, home, family, health and wealth – that generate the positive, liberating potential of economic security. They are the platforms of human, social and economic capital from which people can plan ahead, take risks, invest in themselves and their community, and participate fully in wider social and economic life.
This insight draws attention to the psychological dimension of economic security. Research suggests that insecurity, both real and perceived, is associated with fear, stress and anxiety. It shrinks horizons, narrows possibility, limits agency and corrodes hope. In contrast, security breeds psychological safety and feelings of confidence and self-worth. It is arguably a precondition for people to feel in control of their life, to have a stake in the future, and to believe that daily efforts can pay off and that hard work will be rewarded. We can’t expect to cultivate the dynamism and creativity necessary to break the UK’s productivity slumber when so many people are living with forms of insecurity that leave them perennially on the brink.
Drawing on the idea of positive freedom, economic security puts human agency centre-stage, in pursuit of autonomy, control and individuality, while recognising that these require far more than the removal of external constraints. So the expansion of economic security is a fundamentally egalitarian project. Unlike abstract measures of progress or ideas of justice, economic security is rooted in concrete, everyday experiences: a cancelled shift, an unexpected rent hike, nothing set aside for a rainy day, childcare falling through, and now the impact of rising borrowing costs. But it also draws attention to how these connect to deeper trends and the need to reorder the terms of our economic and social settlement.
We might say that to be and to feel economically secure is to live with dignity, to be able to seize opportunities and to have a sense of ordinary hope for the future. That requires sufficient and predictable resources, of income and wealth, in relation to the costs and burdens of life. It rests on secure work and a secure home, on education, on good health, and on reliable caring infrastructure. It is sustained by relationships of family, friends and community. It means you can cope when life takes an unexpected turn and have a platform to thrive. It’s something you have and are, but also something you feel and need to believe in. To advance economic security is to care about the demanding conditions for people to be the author of their lives, and to be able to participate in society to their fullest extent.
Uncertainty is not just a fact of life, it’s a large part of what makes it worth living. To be human is to not quite know what’s around the corner. The question is whether you are able to adapt to events and engage with the possibilities of change, or whether you are subject to forces beyond your control. There is evidence that aspects of economic insecurity inhibit risk-taking, innovative activity and entrepreneurialism. In an era of shocks and transitions, our future prosperity will rest, in part, on as many people as possible having the secure foundations – material, social, emotional – from which to harness and shape these shifts, as opportunities not threats.
The policy response
Picking up this challenge, the value of economic security is a lens through which we can diagnose where we’re falling short as a society, and for inspiring and guiding a project of social reform in response. Our report argues that this points towards a strategy for expanding economic security with two parts. First, defensive action to protect against harmful insecurities, by placing limits on markets and entrenching state-backed minimums. And second, positive action to advance the foundations of security, especially via institutional activism that shapes market or state outcomes and harnesses forms of local, people-powered and civic endeavour.
Good, secure work is fundamental to economic security. But while hourly low pay has fallen and cyclical unemployment remains low, more than a fifth of UK workers are in some form of precarious work. And over two million are excluded from the labour market with a health condition or disability but say they want to work now or in the future. Advancing economic security would mean raising workplace protections, such as increasing minimum-contracted hours and lengthening notice of shift patterns, and forging social partnership institutions in precarious sectors, such as hospitality, retail and care. It would mean entrenching a job guarantee to limit the duration of long-term unemployment and mobilising locally led support to make work possible and desirable for those at risk of being written off.
Alongside work, economic security also rests on family as the first line of love and support in times of need, and as the basis from which one can thrive. But while flexible working and childcare have steadily advanced, progress is incomplete. Less than half of local authorities have enough childcare for working parents to meet free early-education entitlements, more than half of low-paid workers say they wouldn’t be paid if they missed a day’s work due to a family emergency, and the pay penalty for people leaving work to care is stark. A pro-security response would involve protecting time for families with flexible work as a day-one default, making childcare a system of social infrastructure that parents can rely on, and creating statutory care pay, modelled on maternity provision, to enable people to look after loved ones without losing their attachment to the world of work.
In housing, perhaps the most consequential trend has been the shift away from secure tenures. The proportion of households renting privately more than doubled from one in ten at the turn of the century to almost one in five by 2020. To address this, a strategy for greater economic security would enhance protections for private renters, reform the mortgage market to help first-time buyers, and mobilise action across society to end homelessness. But it would also intervene in markets to increase the supply of more secure housing tenures, through new building and the distribution of existing homes. That might involve establishing a publicly owned master developer to drive the delivery of major new settlements in the public interest (maximising homes for resident-owners and social rent). An institutional vehicle could also be created to support social landlords to turn the properties of distressed buy-to-let landlords into homes for social and sub-market rent, where this generates long-run benefit savings.
Cost of living
The most acute aspect of economic insecurity in the UK today is the intensification of financial hardship. The number of people experiencing deep poverty rose by a fifth between 2003 and 2020, while emergency food-parcel distribution has more than doubled over the past seven years. Cost-of-living pressures are biting hard right now, but the underlying problem is that the value of our core working-age benefit is at its lowest in real terms for almost 40 years. Guaranteeing that Universal Credit is enough to afford the essentials would establish a foundation for economic security, as would addressing state-driven insecurity in the benefits system (like the operation of sanctions and the extent of income volatility for low earners). That would be complemented by building up local, civic institutions to provide crisis support, practical help and the hand of friendship and connection when times are tough.
The lens of economic security brings the household balance sheet into focus, especially given the legacy of a long era of fast-rising asset prices (now seemingly at an end). Around a quarter of UK adults have less than £100 savings, while family gifts and inheritances are a large and growing factor in deciding who has assets to plan for their future (not least for housing). Pro-economic security action would involve regulating exploitative lending practices (which the government is backing off from) but also building up better alternatives for those who need affordable credit (perhaps by endowing local, civic lending institutions via a social responsibility levy on the finance sector). As the Tories flirt with inheritance tax cuts, it would be better to focus on the benefits of asset-holding for young people, perhaps by replacing inheritance tax with a gift receipts tax, offering the choice of a generous allowance for those likely to receive family wealth or a capital gift from the state for those who think they will not.
At the other end of life, the state pension provides a foundation of security, and auto-enrolment has got many more into workplace saving. But the now-dominant defined contribution (DC) model means inflation, longevity and investment risks in pensions are shifting on to individuals. In addition to increasing employer contributions, this prompts the need for structural reform to the DC system, especially in the so-called decumulation phase, to offer people predictable, inflation-proof incomes without the risk this might run out if they live into old age. The platform of auto-enrolment might also be used to help people build easy access to rainy-day savings alongside workplace pensions, in addition to entrenching targeted schemes such as Help to Save (underpinned by tilting the balance of tax subsidies for savings in a more progressive direction, where they would make up the most pro-security impact).
Looking ahead, the general election campaign is likely to narrow and trivialise political debate, especially on tax and spend. This risks obscuring the bigger and much more important question – especially for Labour – of what could energise and animate a governing project that meets the moment. The lesson from the Blair-Brown years is that enduring social reforms put down institutional roots and build broad coalitions of support: the minimum wage, pensions, childcare and flexible working.
A generation on, our argument is that the lens of economic security could inspire and guide decisive shifts in the terms of our social settlement, rooted in everyday hope and concerns, while establishing the social foundations for a more productive and resilient national economy in a fragile and uncertain world.