Economic insecurity is Britain's new normal, says head of RSA

By agency reporter
November 21, 2019

Millions of British people face the 2020s fearing a more insecure labour market with little faith the state is willing to help them, the chief executive of the RSA has warned.

In his annual lecture as chief executive of the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA), Matthew Taylor argued that economic insecurity has become the 'new normal' and that it lies behind much public pessimism and anger.  

Showing that insecurity is a social ill that affects more people than commonly thought, Taylor argued that changes in the economy, in policy and our view of ourselves have made insecurity endemic.  

Tackling this new social evil means changes ranging from labour market and welfare reform (including pilots of universal basic income) to lifelong learning and building the self-help capacity of communities.  

A new Populus poll of 2,000 people, commissioned to accompany the speech, found:  

  • 40 per cent of UK adults – or 21 million – are not confident of leading a decent standard of living in ten years – compared to just 43 per cent who are confident  
  • 78 per cent believe workers face more uncertainty and anxiety about their jobs than they did a generation ago  
  • 58 per cent believe government should provide more support to people to help them become more financially secure, including all classes, 62 per cent of women, 55 per cent of me , and 69 per cent of 25-34 year-olds
  • 62 per cent agree "people like me get little or no help from the government”  
  • 54 per cent think inequality will increase without government action
  • 42 per cent believe economic insecurity and poverty are largely the result of government policy; 23 per cent blame individuals’ own choices, and 17 per cent cite the impact of business and employment practices such as zero-hour contracts
  • 35 per cent of ABs say they are currently enjoying a decent standard of living, but are not confident of doing so in a decade’s time.  

A focus on age as well as class is also crucial, Taylor said: only 33 per cent of 35-44 year olds think they will maintain a good standard of living over the next 12 months, compared to 62 per cent of over 65s.  

But older groups worry their relative affluence today may soon end, the polling suggests, as the proportion confident of maintaining a decent standard of living drops from 62 per cent confident for the next year to just over one-in-four in a decade's time, while younger groups are more confident in their prospects.   

And though Brexit will be the top issue for most age groups in December’s election, 'poverty and inequality in society' and 'my family’s finances' also feature in the top issues groups say will influence their vote.

To tackle this crisis, Taylor called for:  

  • tough measures to address precarity: including a focus on universalism to catch the many missed by a focus on ‘targeting’, such as piloting universal basic income  
  • tough measures to address the causes of precarity: devolving power to local areas, encouragement of inclusive growth, and for companies to take a greater role in the areas in which they are based  
  • a new economic focus, away from free market neoliberalism in favour of a more communitarian capitalism, focused on mutuals and co-operatives.   

The RSA defines economic security as “the degree of confidence that a person can have in maintaining a decent quality of life, now and in the future, given their economic and financial circumstances." Economic insecurity meanwhile is strongly linked to a wide-range of social ills, including poor health.    

Matthew Taylor, chief executive of the RSA, said: “There is no question that economic worry is the new normal for millions of people in this country. The OECD ranks the UK high among developed world counties for employment insecurity while also recognising that – despite its importance – it has no accepted international definition or metrics. However, given its strong association with disadvantage, how does exploring economic insecurity as a social ill add to a more conventional focus on poverty or inequality?

"The most obvious answer is that it [economic security] is not just a social fact; it is a human feeling. As Joseph Rowntree Foundation research has shown, most people in poverty don’t recognise themselves as such. People know that that society is unjust, but few would say that inequality was something they personally suffered. By contrast, insecurity we recognise. 

“More viscerally, it is the unpleasant and often distressing anxiety that we either cannot make ends meet or that we are one setback – loss of work, an unexpected bill, a bout of ill-health – from disaster. Insecurity limits people’s horizons and imaginations, forcing them to focus on the here and now rather than longer term possibilities...

“To achieve a step change in human welfare and wellbeing, including a major diminution of economic insecurity, involves resetting and realigning these systems of authority, belief and aspiration. Reforming authority and restoring people’s faith in institutions. Strengthening solidarity and freeing civil society. And challenging a mythical, arid and destructive account of individual motivation and fulfilment.” 

* Watch the lecture here 

* Royal Society for the encouragement of Arts, Manufactures and Commerce https://www.thersa.org/

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