Guest Blog: Securing a fair work recovery for Scotland – Rachel Statham, IPPR Scotland

Following the publication of ‘Delivering a fair work recovery in Scotland: Securing a living income for all’ paper from The Institute for Public Policy Research (IPPR) we hear from their Senior Research Fellow, Rachel Statham  ‘Securing a fair work recovery for Scotland’.

Work is at the centre of how we organise our society and our lives. Fair work can provide people with a decent standard of living, a sense of purpose and a means of contributing to society. But for too many people in Scotland, work fails to deliver decent living standards or the security on which to build a good life.

As we look towards recovery from Covid-19, there is opportunity to shift the dial on fair work. Instead of focussing on creating jobs at any cost, it’s time to redouble our efforts to deliver good jobs – that deliver decent pay, living hours, a voice at work, and opportunities for progression.

At IPPR Scotland, our ‘living income’ programme is exploring how social security, work and services can do more to deliver a decent standard of living for everyone. In the second major report from this programme, we explore the state of Scotland’s labour market, and set out a roadmap to make fair work a reality across Scotland’s workforce.

For too many, work is failing to provide a route to financial security

Rachel Statham, Senior Research Fellow – IPPR Scotland

We find that too often, work is still not a reliable route to financial security. One in five workers surveyed in Scotland typically receive two weeks’ notice or less of their working hours, and one in 10 employees – or over 200,000 people in Scotland – feel their work does not offer them a stable and predictable income. To realise financial security through fair work, we will need to see an overriding focus on driving up job quality through Covid-19 recovery and transition to net zero.

We also find a labour market shaped by inequalities: women in Scotland are still 50 per cent more likely to be low paid than men, and black and ethnic minority workers are 38 per cent more likely than white workers to experience low pay.

We know progression is a vital route to a living income for low-paid workers – but three in 10 workers in Scotland are not able to progress in work. This is borne out by evidence that seven in 10 workers in ‘routine’ occupations in Scotland in 2010-11 remained in routine work almost a decade later. If we look at pay progression in Scotland, we find that two-fifths of workers reported lower real-terms rates of pay in 2019 than in 2010.

This adds up to a picture of widespread precarity, persistent low pay, and deep inequalities. Urgent action is needed to turn ambitions to make Scotland a ‘fair work nation’ into reality.

This adds up to a picture of widespread precarity, persistent low pay, and deep inequalities. Urgent action is needed to turn ambitions to make Scotland a ‘fair work nation’ into reality.

Securing a fair work recovery

The sectors hardest hit by Covid-19 in Scotland are also some of the key sectors in which low pay and insecurity are concentrated, such as retail, hospitality, social care and childcare. It is likely that they will need ongoing government support. But as we look to rebuild and renew these sectors, there is a clear opportunity for transformation – starting with action on pay and conditions.

To drive up job quality in sectors such as these, we argue that ongoing investment through recovery should be made contingent on agreeing new Fair Work Agreements – similar to New Zealand’s fair pay agreements – that bring employees and employers together to set trade union-negotiated minimum standards for pay, hours and conditions on a sector-by-sector basis.

Alongside a focus on pushing up job quality, we need to lower the barriers that too many people still face getting into and getting on in work. This should start with a new lifelong learning offer, ensuring everyone in Scotland can take up training to support their progression. We also need to use all the levers available to government to make flexible working by default the norm, not the exception.

Finally, we need to tackle the inequalities that shape Scotland’s labour market. This will require action to reduce up-front childcare costs, partnership with employers to reduce the disability employment gulf, and ongoing support for young people who have been navigating the challenging transition between education and work in exceptionally difficult circumstances.

Towards a fair work future

Fair work is crucial to delivering financial security in Scotland. Without decent pay, secure work, or reliable hours, and without opportunities to progress in work, financial security will be difficult if not impossible to achieve for many.

Delivering a fair work future will require near-term action and a long-term commitment to a recovery from Covid-19 that addresses the inequalities exposed and exacerbated through the crisis. This means building an economic model in Scotland with fair work at its heart.

To do so will require commitment from employers and government action, particularly focussed on the sectors and population groups at risk of failing to meet fair work expectations. It will also rely on government in Scotland making use of all of its available levers, powers, and soft power to bring employers and workers together with government to focus on driving up job quality, creating good new jobs (and routes into those jobs for more people), and strengthening labour market institutions.

Now is the time to focus on strengthening Scotland’s economy over the long-term by delivering good jobs, fair work and ultimately greater wellbeing.

Rachel Statham, Senior Research Fellow IPPR Scotland