Exploding the numbers

With good reason, Employment and Unemployment are sensitive issues both emotionally and financially. False statistics are wheeled out at election time as weapons of choice to batter each other with.

Fun to watch, but it’s wearing when it finally dawns on spectators that the figures they are squabbling over are utterly meaningless in the real world. To put it in another more charitable way, they are meaningless except in the context of the political narrative they have been employed to prove or disprove. More often than not, data they argue over are gobbledegook.

The problem with employment figures begins with the definition of the word itself. From most legitimate sources, the literal definition of employment is the condition of having paid work. There are no quantifiers for the amount of time employment must encompass and there is certainly no qualifier indicating that the work must be satisfying and pay enough to cover bills. No, to be in employment one must simply have any sort of paid work at any time of any duration.

Other words such as Job and Work have come to mean roughly the same thing, except when they don’t. For example, employment will always involve doing a job or a few jobs, whereas doing a job for someone may not involve being in employment at all. It’s a minefield, but the point is when one of the most substantive part of living is wheeled out as a barometric indicator of the health and well-being of a nation one must know precisely what the subject is and that its definition is commonly understood and relates meaningfully to everyday life. In fact, I would go further and argue that the subject must not only be properly defined, we must also be totally confident data is acquired, evaluated and presented by people we trust without bias or political agenda.

Headlines in the press recently broadcast the assertion that at the beginning of 2017 “a larger proportion of working-age people had a job of some description than had ever been recorded before.” Now, from a statistical point of view I can see why this statement might be pant-wettingly exciting, however, from a real life perspective it’s pretty meaningless and almost certainly untrue. It throws up more questions than I suspect there are answers. Exploring definitions alone, being of “working age” does not necessarily mean those people are able and/or willing to do a job of work while “a job of some description” points rather too comfortably to politicians’ wriggle-some sound-bites. A job that lasts five minutes or an hour a day and pays nothing isn’t worth a line on an under-employed economics graduate’s CV and cannot be regarded as employment, or being employed, by any standard.

In the UK it’s generally believed that the methods used by the various agencies to gather and present statistical information are done with politically motivated intentions to disguise problems in the wider economy.

And it’s true, whenever we, the British public, are presented with employment and unemployment figures the supporting evidence runs to page after page of figures, graphs, and tables most of which make very little sense when set against our knowledge of what is actually going on around us. In business, I have always used the rule of thumb: where a report is overly complex, any attempt at proving its veracity one way or the other is rarely worth the expenditure or the resources. I always suspect the presenter is hiding the truth and/or their incompetence behind a blizzard of paper.

All too frequently, confusion and incompetence are exascerbated when the wrong questions are asked and the wrong answers subsequently misapplied. Whilst the response might sound good it will almost certainly bear no meaningful relation to the matter in hand. The numbers quite literally self-ignite. For example, in a recent report into reasons behind Britain’s record employment, we were assured that “the number of people temporarily employed because they couldn’t find permanent employment made no significant contribution to the overall number of people in employment.” What does that even mean? It’s utter rubbish, for the simple reason that, temporary or permanent, a job is a job and politicians will certainly count them all as employed in official figures. But to say a proportion of people are only working in temporary employment because they can’t find a permanent position is pointless in the same way as saying people only fly with British Airways because they can’t find any pterodactyls. The figures would only be relevant if there was known to be an abundance of permanent positions waiting to be filled or there was known to be none at all.

As far as levels of employment are concerned, it’s the shortfall, or otherwise, between the numbers of workers and jobs of all descriptions that are meaningful.

Zero Hour Contracts also conspire to make a nonsense of employment data in the UK. The majority of the very few EU countries which allow these types of contract do not classify people on such contracts as employed. On this basis, if we were to apply the same criteria to the UK, it is calculated that more than a million extra workers would be added to the unemployment register. As such, we would immediately see the boast that more people are employed than ever before is nonsense.

I would like to think these EU states are driven by the desire to expose problems in their economies so they can be dealt with rather than to hide them as is done in the UK.

So, what is actually needed in order for everyday people to form an informed opinion of how well the employment needs of UK citizens are being met by government and how well our economy is being run on our behalf?

Let me make a start by suggesting a few fundamental measures:

  • Full-time employment means the working week should be no less than 30 hours (the EU says 48, but what the heck!). So, to be in part-time employment the hours worked must be less than 30 regardless of the number of contracts the hours are spread over.
  • Contracts of Employment or several contracts compounded should be capable of supporting, say, a mortgage application.
  • When advertised, the wage for every job should also be shown as a percentage of GDP per capita (e.g. a job paying £20,000 per annum would have a GDP per capita value of approximately 50%).

Additionally, it would be beneficial to individual workers and the economy as a whole if every employment paid at least the minimum living wage as set by the Living Wage Foundation.

To establish these as the basis for getting at the truth about employment in the UK would be a good start.

© Rod McRiven 2017

1 Comment

  1. It could be that your thesis is universal….same here in the U.S. It’s a gauge that only makes sense if one believes that the government can solve all “problems” and that a change (of parties) will make people happier. The assumption is that the government “cares” about employment figures because it makes for a better “life” for the public – which isn’t true at all…the reason for these figures is to gauge how much money will flow into the public coffers to pay the politicians to convince the public that they are happy….unaware and compliant. Haha!

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