Labour Market Realities: Privatisation and the Railways
Record levels of employment and unemployment are once again back in the headlines with the release of the first labour market statistics of 2018. Yet these numbers remain distract from an economy that is not working for the average worker. For the ninth month in a row real wages are falling and a decade after the financial crash, average regular pay is still lower than the pre-downturn peak.
High inflation, meanwhile, is exacerbating a cost-of-living crisis. Perhaps most emblematic of this is the annual hike in rail fares which has outstripped wage growth all-but-one year since 2010. The general public is essentially paying for these services twice as subsidies for the railways have increased since privatisation and now rank among the highest in Europe. At the other end of the spectrum, and as highlighted in the video above, shareholders receive handsome pay-outs. With Davos also in the news this week, this is a timely example of growing inequality in our society.
Further, there are segments of the workforce that are faring even worse than the average. As mentioned in this series previously and reiterated at the launch of a Smith Institute paper in parliament this week, privatisation and outsourcing tend to weaken employees’ bargaining rights and driven down pay.
As Manuel Cortes, General Secretary of the TSSA, notes this is concurrent with a rise of employee stress and work intensification. These are facets of the economy that are widely overlooked but reflect the reality of the current labour market. Look out for a report from CLASS in the next month that brings these issues to the fore.