The challenges of low pay and inequality for the new government

Barely a month has passed since the UK referendum on 24 June 2016, but the dramatic shifts in the political and economic landscape have been immense and as yet, unsettled. The UK, under the new leadership of Theresa May will have to decide on the timing and nature of Britain’s exit from the EU – a decision with both major domestic and global implications. The momentous task of steering the UK economy through the course of the divorce proceedings with Europe will require civil society organisations, like The Work Foundation, to double our efforts in noting the impacts on people’s working lives.

In facing the challenges ahead it is both important to understand and address the underlying structural grievances that are likely to have driven the direction of the vote. These were multiple and complex and in months, if not years to come, researchers will be dissecting the statistics to try and make sense of an outcome most Economists did not expect. One of the striking features was grievances and fears over the standard of living and work conditions.

Early analysis of voting doesn’t represent a straightforward pattern in terms of class and income. However, the Resolution Foundation’s analysis of data showed that “the relative levels of pay in an area do matter for how people voted. Areas that voted to leave the EU weren’t those that did badly in recent years, but areas in which people simply earn less.” The author goes on “it is areas that are, and have been for some time, poorer. Or to put it another way, it’s the shape of our long lasting and deeply entrenched national geographical inequality that drove differences in voting patterns.”